Energy Efficiency in the Federal

Government: Government by Good

Example?

May 1991

OTA-E-492

NTIS order #PB91-197905
Recommended Citation:

U.S. Congress, Office of Technology Assessment, Energy Efficiency in the Federal

Government: Government by Good Example?, OTA-E-492 (Washington, DC: U.S. Government Printing Office, May 1991).

For sale by the Superintendent of Documents

U.S. Government Printing Office, Washington, DC 20402-9325

(order form can be found in the back of this report)
Foreword

This report was prepared in the course of the ongoing OTA assessment, “U.S. Energy

Efficiency: Past Trends and Future Opportunities,’ which is being carried out in response to

requests from the Senate Committees on Governmental Affairs and on Energy and Natural

Resources; the House Committee on Energy and Commerce; and endorsed by the

Subcommi ttee on Environment, Energy, and Natural Resources of the House Committee on

Government Operations and by the chairman of the Subcommittee on Environment of the

House Committee on Science, Space, and Technology. Other reports to be prepared in this

assessment will examine energy use in the residential and commercial sector, industry,

transportation, and electric and gas utilities.

This report focuses on the Federal Government, the Nation’s largest single energy

consumer, in terms of the opportunities and constraints for the use of energy efficient

technologies. Energy efficient technologies could greatly reduce energy demand growth and

spending in the United States and lessen environmental impacts while increasing productivity.

Yet, in today’s public and private markets, adoption rates for many of these technologies are

low. This report reviews past and current efforts to improve Federal energy efficiency and

discusses policy options that could accelerate the adoption of these measures by the Federal

Government.

OTA appreciates the substantial assistance received from many organizations and

individuals in the course of this study. Members of the advisory panel provided helpful

guidance and advice; reviewers of the draft report contributed greatly to its accuracy and

completeness; personnel at the case study facilities shared their valuable experiences and

perspectives. To all of them goes the gratitude of OTA and the personal thanks of the project

staff.

u Director

.,. 111
Advisory Panel—U.S. Energy Efficiency: Past Trends & Future Opportunities

James F. Gibbons, Chairman

Dean, Stanford University

Terman Engineering Center

Dale Compton

School of Industrial Engineering

Purdue University

Marc Cooper

Consumers Federation of America

Robert deHaan

Amana Refrigeration Co.

Daniel A. Dreyfus

Gas Research Institute

Clark W. Gellings

Electric Power Research Institute

David B. Goldstein

Natural Resources Defense Council

Cheryl Barrington

Maine Public Utilities Commission

NARUC Energy Conservation Committee

Kenneth Hickman

Applied Systems Division

The York International Corp.

Edward McInerney

GE Appliances Division

General Electric Co.

Alan Miller

Center for Global Change

University of Maryland-College Park

Gary Nakarado

Public Utility Commission of Colorado

John W. Rowe

New England Electric System

Maxine L. Savitz

Garrett Ceramic Components

Garrett Processing Co.

Sherwood Smith

Carolina Power & Light Co.

Richard Tracey

Ryland Homes

B.C. Waycaster

Hydrocarbons and Energy Department

Dow Chemical

Gunnar Walmet

New York State Energy Research and

Development Authority

Mason Willrich

Pacific Gas & Electric Enterprises

James L. Wolf

The Alliance to Save Energy

Eric R. Zausner

Strategic Performance Management

NOTE: OTA appreciates and is grateful for the valuable assistance and thoughtful critiques provided by the advisory panel members. The panel does

not, however, necessarily approve, disapprove, or endorse this report. OTA assumes full responsibility for the report and the accuracy of its

contents.

iv
OTA Project Staff—Energy Efficiency in the Federal Government:

Government by Good Example?

Lionel S. Johns, Assistant Director, OTA

Energy, Materials, and International Security Division

Peter D. Blair, Energy and Materials Program Manager

Project Staff

Robin Roy, Project Director

Helene Kirwan-Taylor, Research Assistant

Administrative Staff

Lillian Chapman, Office Administrator

Linda Long, Administrative Secretary

Tina Brumfield, Secretary

Contractor

Naresh Khosla

Enviro-Management and Research, Inc.

Springfield, VA
Reviewers and Contributors

Sean Allan

U.S. General Services Administration

Gerald Aman

Richmond Redevelopment and Housing Authority

Richard Brancato

Federal Energy Management Program

U.S. Department of Energy

Mark Butcher

Department of Veterans Affairs

Medical Center of Washington

Millard E. Carr

Office of the Secretary of Defense

David Claridge

Texas A&M University

Frank Coates

Freedom Energy Services, Inc.

William Currie

Pacific Northwest Labs

Douglas Decker

Johnson Controls, Inc.

J.F. Drummer

San Diego Gas & Electric

William Eschmann

U.S. Postal Service

Janet Fox

U.S. Department of Health and Human Services

Rajinder Garg

U.S. Department of Veterans Affairs

Richard Gudaitis

U.S. General Services Administration

Jeff Haberl

Texas A&M University

Mark Hopkins

The Alliance to Save Energy

Naresh Khosla

Enviro-Management & Research, Inc.

Paul Komor

Office of Technology Assessment

Daniel Lashoff

Natural Resource Defense Council

George Lerg

Freedom Energy Services Inc.

Bernard Manheimer

U.S. Department of Housing and Urban

Development

William Mashburn

Virginia Polytechnic Institute and State University

Patrick McLaughlin

U.S. Army, Fort Belvoir

Guy Miconi

U.S. General Services Administration

Martin Nelson

San Diego Division

U.S. Postal Service

Bob Palik

U.S. Department of Housing and Urban

Development

Willard Powell

U.S. Public Service

Dan Quigley

Pacific Gas & Electric Co.

Joanne Seder

Office of Technology Assessment

Thomas E. Small

U.S. Army Corps of Engineers

Carl C. Votteler

U.S. General Services Administration

James Woods

U.S. General Services Administration

NOTE: OTA appreciates and is grateful for the valuable assistance and thoughtful critiques provided by the the reviewers and contributors. They do

not, however, necessarily approve, disapprove, or endorse this report. OTA assumes full responsibility for the report and the accuracy of its

contents.

vi
Contents

Page

Chapter l: Introduction and Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Chapter 2: Policies and Programs for Federal Energy Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Chapter 3: Federal Spending on Energy Used in Commercial and Residential Buildings . . . . . . . . . . . . . . 37

Chapter 4: Federal Energy Use in General Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59

Chapter 5: Six Case Studies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73

Chapter 6: Constraints on Increased Federal Energy Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89

Chapter 7: Policy Issues and Options for Improving Federal Energy Efficiency . . . . . . . . . . . . . . . . . . . . . . 105

vii
Chapter 1

Introduction and Summary
Contents

Page

INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . ., . . . .,, . . . . . . ., . .,, **,.... 3

FEDERAL SPENDING ON ENERGY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Federally Owned and Leased Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Federally Assisted Households . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Federal Auto and Truck Fleets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Other Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6

Federal Agencies With the Largest Energy Use . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

PROSPECTS FOR ENERGY- AND COST-SAVINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Performance of Energy- and Cost-Saving Measures . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Savings Prospects in Federally Owned Buildings

. . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8

Savings Prospects in Federally Assisted Households . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Savings Prospects in Passenger Vehicle and Truck Fleets . ...*.,...*...,**.....*,,. 9

Savings Prospects in Other Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10

CONSTRAINTS TO IMPROVED FEDERAL ENERGY EFFICIENCY . . . . . . . . . . . . . . 10

Resource Constraints . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11

Information Constraints . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Lack of Incentives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

POLICIES FOR FEDERAL ENERGY EFFICIENCY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Options for Improving Federal Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14

Box

Box Page

l-A. Annual Returns on Investment of 4 to 40 Percent: How High

Is Highly Economic? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Figures

Figure Page

1-1. Federal Spending on Energy, Fiscal Year 1989 . . . . . . . . . . . *, . . . . ., . . * . *, ...*,,... 4

1-2. Energy Consumption by Agency Facilities and Operations, Fiscal Year 1989 . . . . . . 7

1-3. Direct Federal Energy Efficiency Funding, Fiscal Years 1976-90 . . . . . . . . . . . . . . . . . 11

Tables

Table Page

1-1. Constraints on Improved Federal Energy Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

1-2. Policy Options for Federal Energy Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Chapter 1

Introduction and Summary

INTRODUCTION

The Federal Government is the Nation’s largest

single energy consumer. In fiscal year 1989, it spent

$8.7 billion on energy in its own facilities and

operations, and another $4 billion subsidizing the

energy expenses of low-income households (see

figure l-l). The energy purchases paid for by the

Federal Government were over 3 percent of the total

Americans spent on energy in that year. Much of this

energy is inefficiently used. For example, it appears

that commercially available, cost-effective measures including high efficiency lighting and carefully operated heating, ventilating, and airconditioning (HVAC) systems could likely conserve at least 25 percent of the energy used in

Federal buildings with no sacrifice to comfort or

productivity.

Improving energy efficiency has several benefits,

both for the government and for the Nation as a

whole. Inefficient use of energy needlessly exacerbates reliance on imports of oil from foreign sources,

contributes to local and global environmental concerns such as smog and climate change, and

consumes capital and operating expenditures which

would be better invested elsewhere.

The Federal Government has an opportunity

to set a good example for efficient energy use

while reducing Federal spending, reliance on

imported oil, and adverse environmental impacts. It has broad experience using electricity,

natural gas, petroleum products, and other energy in

housing, office buildings, hospitals, transport, and

other facilities and operations. From lighting to

HVAC equipment to automobiles, Federal procurement could also expand market opportunities for producers of efficient technologies,

demonstrate measures useful in the private sector, and encourage more research and development (R&D) by manufacturers.

Since the mid- 1970s, Congress and the executive

branch have developed several programs to improve

energy efficiency in Federal facilities and operations. According to the Department of Energy

(DOE), between 1975 and 1989 these programs

saved close to $7 billion (or about 5 percent of

–3–

Federal energy spending), far more than the $2.5 billion invested in energy conservation measures.

Despite this achievement, considerably greater savings still are possible. Many energy industry observers believe that efficient technologies could greatly

reduce energy use in the United States and reduce

environmental impacts while increasing productivity. Yet Federal agencies’ use of many energy

efficient measures is low. For example, inefficient,

costly-to-operate lighting is still common throughout the millions of square feet of office space owned

or leased by the Federal Government and its

contractors.

The failure of Federal agencies to fully implement

the use of energy efficient technologies results from

a variety of factors. Overall, energy efficiency is not

central to most agencies’ missions and has received a relatively low priority. Reflecting the low

priority, there is a shortage of trained personnel

and a scarcity of the capital needed to make even

short-term investments. Several other constraints

seem important, as well. These include a lack of

incentives, a lack of systematic assessment of

opportunities, and uncertainty about the cost and

performance of some technologies. Many of these

factors apply to the private sector as well as to the

Federal Government. An examin ation of energy

efficiency measures and the technical and institutional impediments to their use is important in

developing effective, low cost energy policies not

only for the Federal Government but for the economy as a whole.

This report examines opportunities for improving

the efficiency of Federal energy use and spending,

concentrating on opportunities in federally owned

buildings. Some opportunities for Federal vehicle

fleets are also discussed. The report also briefly

describes some specialized but large Federal energy

uses such as military aircraft. Prospects for energy

efficiency gains in federally assisted housing are

also briefly discussed since the Federal Government

spends several billion dollars each year on the

energy used in those households. Although assisted

housing is not the focus of this report, it is included

to give a more complete picture of Federal spending

on energy.
4 ● Energy Efficiency in the Federal Government: Government by Good Example?

Figure l-l—Federal Spending on Energy,

Fiscal Year 1989

sisted housing

Federally owne 4.0

buildings

3.5

Other operations

1.3

Autos and ~

Iight trucks %~

. . U.3 Military jets

3.6

SOURCE: U.S. Department of Energy, Federal Energy Management

Program, “Report on Federal Government Energy Management

and Conservation Programs,” October 1990.

Chapter 2 reviews the diverse policies and programs the Federal Government has pursued to improve its energy efficiency. Chapter 3 examines the

technical and economic prospects for improving

efficiency to reduce Federal spending on energy in

buildings, including both federally owned buildings

and federally assisted housing. Chapter 4 describes

the energy used in general operations, including

automobile fleets and military operations. Chapter 5

presents case studies of energy use and prospects for

savings in six federally owned, leased, and assisted

facilities. Chapter 6 describes the main constraints to

improved energy efficiency in Federal facilities,

including both technical and institutional impediments, Finally, chapter 7 suggests congressional

policy options in light of the existing, untapped

technical and economic opportunities for energy

savings.

FEDERAL SPENDING ON ENERGY

Federal spending on energy can be categorized in

four groups: 1) federally owned and leased buildings, 2) federally assisted housing, 3) Federal auto

and truck fleets, and 4) specialized operations,

predominantly military mobility. This section describes those categories and how energy is used in

them. The Federal agencies with the largest energy

use are noted at the end of the section.

Federally Owned and Leased Buildings

The Federal Government owns and leases around

500,000 buildings of various sizes, construction, and

uses. About 51,000 of these are commercial buildingsl owned by the government in the United States

with between 1 and 2 billion square feet of floor

space. Federal buildings are highly diverse, including offices, retail shops, hospitals, and industrial

facilities. The Federal Government also owns 422,000

housing units for military families, and afar smaller

number in the Departments of the Interior, Transportation, and other agencies. The government leases

about 7 percent of its floor space from private

owners.

The Department of Defense (DOD) owns about

two-thirds of the Federal Government’s total domestic floor space. Federal agencies own most of the

building space they occupy, but also often lease

some of their space either from private companies or

from the General Services Administration (GSA),

which owns and leases commercial space on their

behalf. Because GSA manages some property for

other agencies, it is the third largest owner (after

DOD and the U.S. Postal Service (USPS)) of Federal

buildings, with nearly 9 percent of the total governmentowned building space.

In fiscal year 1989, the energy used in Federal

buildings cost the U.S. Treasury around $3.5 billion. 2 Most of the energy is used just to make the

buildings inhabitable, that is, to provide light and

HVAC. Large amounts of additional energy are used

to power the wide assortment of appliances and

equipment used in the buildings, ranging from

computers to conveyor belts to stoves.

Electricity is the dominant energy form used in

Federal buildings in terms of total annual spending

($2.4 billion in 1989). Electricity is essential for

powering lights, electronic equipment, and the wide

array of motors found in everything from HVAC

equipment to elevators to conveyor belts and is also

used for heating and cooking. Lighting alone accounts for about 30 percent of electricity use in

commercial buildings. While electricity is extremely

versatile, it is also the most expensive per unit of

energy delivered to the Federal Government (at an

IDeffi~ as ‘‘roof~ and walled structures used predominant tly for a nonresidential, nomgricultural, and nonindustrial purposes’ with floor space

over 1,000 square feet, as in U.S. Department of Energy, Energy Information Administratio~ Characteristics of Commercial BuiIdings 1986,

DOE/EIA-0246(86) (Washingto~ DC: U.S. Government Printing OffIce, September 1988), p. 3.

2AII additional ~estimat~ amowt was spent on energy used in leased buildings for which the Federal Government does DOt pay Utihth dkf@.
Chapter 1--Introduction and Summary ● 5

average $17/million Btu, electricity is about four

times more costly than natural gas).

Natural gas is the second most heavily used fuel,

accounting for about $0.5 billion in 1989. It provides

most of the energy for space heating, water heating,

and cooking. Fuel oil is also used for heating and

accounted for about $0.35 billion in 1989. Other

energy forms include coal and purchased steam.

Federally Assisted Households

As of 1989 there were over 90 million households

for about 240 million people in the United States.3

The Federal Government subsidizes part or all of the

utility bills in about 9 million of these households.

Two executive agencies are responsible for the vast

majority of indirect Federal expenditures on residential energy use: the Departments of Housing and

Urban Development (HUD) and Health and Human

Services (HHS).4 These two agencies subsidize or

provide assistance payments for residential utility

bills for low income Americans.

Each year, HUD spends from $2 to $3 billion

subsidizing the energy bills for 3.6 million federally

assisted housing units. There are two main HUDassisted housing programs: a low-income public

housing program and the Section 8 rental housing

assistance program which can be used in privately

owned housing. Both programs are administered by

HUD-regulated local public housing authorities

(PHAs), of which there are about 2,700 nationwide.

HHS’s Low Income Home Energy Assistance

Program (LIHEAP) assists about 6 million lowincome households in meeting the costs of residential heating or cooling. Some LIHEAP recipients

live in HUD-assisted housing, but the majority do

not. HHS provides grants to the States, Indian tribes,

and territories which administer the program. In

fiscal year 1989, HHS spending on LIHEAP totaled

$1.4 billion.

A few main energy uses constitute the majority of

residential energy consumption and spending. By far

the highest on the list both in terms of total energy

use and spending is space heating. Natural gas

supplies over two-thirds of the energy used for space

heating. Most households also have a water heater,

which on average consumes 18 million Btus/year,

making that the next largest residential energy use.

As with space heating, natural gas provides twothirds of the energy used in water heaters.

Refrigerators are the largest single use of residential electricity, consuming about 20 percent of the

total. Nearly every household has a refrigerator,

which on average consumes about 1,500k Wh/year.5

Air conditioning is the second largest residential

electricity use after refrigerators. A large list of other

uses including cooking, dishwashers, clothes washing and drying, lighting, and electronic equipment

such as televisions make up the remainin g 16

percent of household energy.

Federal Auto and Truck Fleets

In total the Federal Government owned 106,108

sedans, 15,973 station wagons, and 323,479 light

trucks in 1988. In addition, there were 12,641 buses

and ambulances and 55,481 medium and heavy

trucks. DOD and USPS have the largest fleets, each

with about 30 percent of the total. GSA, which has

oversight responsibility over federally owned and

leased passenger vehicles, has about 20 percent of

the total. Almost every Federal agency owns at least

one vehicle and may lease many others from the

GSA Federal Fleet Management System. With few

exceptions, the Federal automotive fleet is petroleumfueled (i.e., gasoline and diesel fuel), although there

are some alternate fuel vehicles (e.g., natural gas).

Each year, the Federal Government replaces about

100,000 of its cars and light trucks, accounting for

about 1 percent of domestic production. About

50,000 of these are procured by GSA.

Increasingly, the Federal auto fleet is relying on

compacts. In 1988 compacts outnumbered other

classes of sedans by almost 2:1. The shift in the

makeup of the Federal fleet to smaller, more fuel

efficient cars has resulted in higher fleet average fuel

mileage. In 1989, the Federal Government bought

329 million gallons of gasoline at a cost of $309

million. In 1989, the average Environmental Protection Agency (EPA) fuel economy rating of the Federal automobile fleet was 29.4 miles per gallon

(mpg), 7 percent higher than the minimum corporate

~~s ~opujation est~ate does not ficlude the homeless and people living in institutions (e.g.. mlfi~b~ac~ ad PfiSoQs).

4As noted previously, the Department of Defense owns about 400,000 mihry hous@ Ufi@.

5Refngerator5 ~ fedemlly Omed or a55i~t~ hou5~g may be sma~er ~th less enqg.us~g fea~es (e.g., ~ough-the-door iCe &speIlSer5) than the

average.
6 ● Energy Efficiency in the Federal Government: Government by Good Example?

Photo credit: General Dynamics

Military aircraft consumed over 3.6 billion dollars’ worth

of jet fuel in fiscal year 1989.

average fuel economy requirement for manufacturers.

Other Operations

In fiscal year 1989, the Federal

consumed about $4.9 billion worth

Government

of energy in

highly specialized operations. By far most of the

energy used in operations is defense-related in the

form of military mobility energy. Military mobility

refers to activities such as flying aircraft, sailing

naval vessels, and operating tanks and other landbased military equipment. In fiscal year 1989,

military aircraft and surface equipment consumed

over $3.6 billion in jet fuel and about $0.6 billion in

diesel fuel.

Much of the remaining energy for operations is

also defense-related, used by DOD in various

processes and by DOE in its uranium enrichment

facilities and production nuclear reactors. Production reactors are industrial facilities for producing

nuclear fuel and nuclear weapons materials. Nondefense operations using large amounts of energy

include DOE’s research facilities such as reactors

and linear accelerators.

Federal Agencies With the Largest Energy Use

The five Federal agencies using the most energy

in their facilities and operations are, in order: DOD,

DOE, USPS, the Department of Veterans Affairs,

and GSA. Together they consume over 90 percent of

the Federal Government’s total.

DOD is by far the largest consumer of energy in

the Federal Government. In fiscal year 1989, DOD

consumed over 80 percent of the energy used in the

Federal Government (see figure 1-2). DOD used

nearly 1.6 quadrillion Btus costing more than

$2 billion in its 1,896 million square feet of buildings. DOD’s facilities are extremely diverse, including residences, offices, and food service and health

care facilities. DOD also spent about $4.6 billion on

energy for general operations, the majority for

military mobility.

The largest consumer of energy among the

civilian agencies is DOE. Energy-intensive processes such as nuclear research and development and

production of nuclear materials accounted for nearly

40 percent of DOE’s energy use. The USPS, with its

vast number of post offices and delivery operations

is the next largest Federal consumer. Veterans

Affairs ranks next with its 174 medical centers.

Rounding out the five largest agencies is the GSA,

in its role as provider of some of the office space

used by other agencies.

In addition to the $8.7 billion spent by Federal

agencies in their own facilities and operations, HUD

spent about $2.5 billion subsidizing utility expenses

in HUD-assisted housing, and HHS spent about

$1.4 billion on energy assistance for low-income

households.

PROSPECTS FOR ENERGY- AND

COST-SAVINGS

After many years of both R& J.) and commercial use throughout the private sector and within

the Federal Government, it is clear that energy

efficient technologies can work well and reduce

costs. Federal agencies estimate that between 1975

and 1989, their energy efficiency programs for

Federal facilities and operations saved $7 billion, or

about 5 percent of the $128 billion spent on energy

during that time.6 Savings from many of these

programs continue to accrue.

bEsti~tes for 1975-84 horn the U.S. Department of Energy, “Annual Report on Federal Government Energy Management Fiscal Year 1985,”

DOE/CE-0171, August 1986, table C, p. C-1. Estimates for 1985-89 from the U.S. Department of Energy, ‘‘Annual Report to Congress on Government

Energy Management and Conservation Programs, Fiscal Year 1989,” Oct. 3, 1990, table E, P. 74.
Chapter 1-Introduction and Summary ● 7

Figure 1-2—Energy Consumption by Agency Facilities

and Operations, Fiscal Year 1989

Trillion Btus

800

700

600

500

400

300

200

100

0

Gasoline Fuel oil Jet Electricity Natural Other

fuel gas

Agency

= Defense = Energy Cl USPS

- V A k%%% GSA ~ Other

SOURCE: U.S. Department of Energy, Energy Information Agency, “Annual Energy Review 1989,” DOE/ElA-0384(89), May 1980.

Considerable additional savings appear possible,

although Federal agencies have not developed

estimates of the potential energy- and cost-savings

or of the capital and other resources required to attain

those savings. The best information available (which

is only very approximate) indicates that a reduction

in energy use of at least an additional 25 percent is

technically feasible and economically attractive for

both federally owned and federally assisted buildings. That represents an annual savings of nearly

$900 million in federally owned buildings, although

achieving those savings could require initial investments on the order of $2 to $3 billion. Additional

cost-effective savings would be possible with further investments, although any precise estimates are

more speculative.

Performance of Energy- and Cost-Saving

Measures

There are no magic technologies which will

revolutionize Federal energy use (or private-sector

energy use). Rather, there are many diverse technologies which work well that together can substantially reduce energy use and spending. For nearly

every application of energy, measures are available

that can improve the efficiency of use. Many have

attractive cost and performance characteristics. Some

energy- and cost-saving measures, such as motion

detectors to control lights in occasionally used

spaces, and highly efficient electronic ballasts and

fluorescent T-8 tubes, have commercially proven

economic and operating performance. Eventually,

use of these approaches may become the standard

rather than the exception that they currently are.

Not all energy efficiency programs have performed as well as expected.7 Sometimes new

technology does not perform as it should, as in the

case of the excessive premature failure rate which

plagued some early electronic ballasts. As a corollary, technologies are continually being improved

and refined, or they will disappear from the market.

The demonstrated high reliability of currently available electronic ballasts again provides a good

example. Unfortunately, as with any evolving technology (and as with many well-established technologies), some products have marginal to poor performance and economics but have yet to be driven

off the market.

Because of the wide variety of buildings, uses,

technologies and other conditions, it is possible

that good technologies can be misapplied, resulting in poor performance or unmet economic

expectations. For example, because compact fluorescent lamps are larger and heavier than the

incandescent bulbs they replace, there are many light

fixtures in which they cannot be used. Thus, a

program to replace all incandescent bulbs in a

building with compact fluorescent could produce

considerable dissatisfaction.

Deciding which measures to pursue often requires

careful engineering and economic analyses. Successful programs, those which reduce energy use and

overall costs, also often require ongoing, dedicated

efforts to ensure that they work initially and continue

to work. Some measures have highly site-specific

economic and performance characteristics, requiring fairly detailed engineering and economic

analyses. For example, the benefits of adding an

energy monitoring and control system in a facility

depend on the type of HVAC equipment in place and

possible plans to replace existing equipment, as well

as the buildings’ external characteristics and internal

layout and occupancy. Similarly, opportunities to

delamp, or reduce lighting in over lit areas, can only

be determined from a properly conducted site survey

which evaluates current lighting levels and the levels

~ this repofi ‘energy efficiency program’ refers to acombinationof energy efficient technology and an institutional system to select and implement

tbat technology.
8 ● Energy Efficiency in the Federal Government: Government by Good Example?

which would result after delamping. Another factor

causing the benefits of efficiency measures to be

site-specific is that energy prices vary considerably

across the country. For example, the average price of

electricity for commercial customers in 1989 ranged

from a high of $0.099/kWh in the State of New York

to a low of $0.041/kWh in the State of Washington.g

While the applicability of many measures is sitespecific, agencies often conduct site surveys including engineering and economic analyses to identify

candidate measures, although inadequate funding

and staffing have constrained full implementation.

Savings Prospects in Federally Owned

Buildings

There is little question that a large fraction of the

Federal Government’s $3.5 billion direct annual

spending on energy in its own buildings could be

greatly reduced using existing, proven technologies.

For example, at the four federally owned facilities

in OTA’S case studies, the facility personnel

estimated that an average savings of at least 25

percent in annual operating cost and energy use

appears achievable with proven and highly costeffective technology. This saving requires no

change in occupant comfort or productivity; rather,

it involves more effective use of energy, either

through more efficient equipment or through improved operations and maintenance practices. OTA’s

case study estimates were intended to include only

highly cost-effective options in which the capital

costs and other costs of implementation are small

compared to the savings, with simple paybacks of

under 3 years. Some measures such as improved

operation and maintenance or using high-efficiency

lighting systems supported by utility rebates have

paybacks of under 1 year. A less stringent economic

test which is more consistent with the cost of capital

to government would produce considerably higher

estimates of savings potential (see box l-A).

The Federal Government has not developed

estimates of either the governmentwide potential

for energy and cost savings or of the capital and

other resources required to attain those savings.

Similarly, none of the individual Federal agencies

contacted by OTA have produced such estimates for

their own facilities and operations although some are

undertaking such efforts. All cite difficulties of

performing the information collection and analyses

required even for approximate estimates. Although

building audits mandated under the Energy Conservation Policy Act were conducted at most major

facilities a decade ago, there has been no Federal

effort to compile the results, much less to keep

results current. The same appears to be true of the

facility energy surveys mandated under the Federal

Energy Management Improvement Act of 1988.

The lack of reasonably detailed, comprehensive

analytical effort to date should not be interpreted as

representing a lack of energy efficiency opportunities. Although Federal agencies have not published

overall estimates of prospects for efficiency gains,

they often take the public position that large gains

are possible. It is important to note that many

relatively easy, low risk energy- and cost-saving

measures with excellent economic characteristics

have yet to be implemented at Federal facilities.

These measures range from using higher efficiency

lights and equipment to improved operation and

maintenance of HVAC systems. The best options

currently available appear to be attractive under

virtually any set of reasonable assumptions of future

energy prices.

Savings Prospects in Federally Assisted

Households

As with the Federal Government’s commercial

buildings, there seems little question that increased use of existing, proven technologies would

reduce a large fraction of the $4 billion spent on

residential energy by the government in federally

assisted housing. This savings requires no loss of

occupant comfort and frequently actually increases

comfort, as in the case of repairing broken windows

and stopping drafts. Since space heating is the

leading residential energy use, many opportunities

for energy and cost savings depend on promoting

higher efficiency heating equipment and weatherization programs. Opportunities for savings are large.

For example, a comprehensive study for HUD of

energy-saving opportunities in public housing published in 1988 estimated the potential for over 30

percent savings with an average payback of 4.5 years

using measures such as weatherstripping and insulation and door and window repairs. Similarly, facility

managers at OTA’s case study of one public housing

W.S. Department of Ener~, Energy mormation Administratio~ EZectric F’ower Annual 1989 (Washington DC: U.S. Government fintig Office,

January 1991), table 30, p. 59.
Chapter 1--Introduction and Summary ● 9

Box I-A—Annual Returns on Investment of 4 to 40 Percent: How High Is Highly Economic?l

Consider a project to replace a Federal building’s fluorescent lamps and ballasts with well-proven high

efficiency components. Is this project economically attractive if it costs $100,000 initially, has a 15-year life and

saves $40,000 annually? What if it saves $12,000 annually? The answers depend on the Federal Government’s

investment criteria.2

The discount rate, or minimum annual return on investment, is the key investment criteria considered in

economic analysis of investment options. The discount rate reflects the natural preference to have money sooner

rather than later, and the cost of obtaining funds for investment. Under current law, the discount rate to be used in

Federal energy analyses is set by the Secretary of Energy. 3 As specified by DOE, the discount rate is now based

on the interest rate on U.S. Treasury bonds after removing the effects of inflation, subject to a floor of 3 percent and

a ceiling of 10 percent.4 Currently, 30-year Treasury bonds have a nominal yield of about 8 percent, which translates

to 4 percent after inflation. Treasury notes and Treasury bills, which have shorter terms of under 3 years, currently

have even lower yields, as low as 2 percent after inflation.

Because so many energy efficiency opportunities in the Federal Government are currently untapped and

because there are severe data and analytical limits on existing governmentwide opportunities, this study focuses on

measures with much higher returns on investment, typically 30 percent or more+ (A project with a 3-year simple

payback and a 10-year life has a return on investment of about 30 percent+) These investments are very highly

economic, exceeding by several times the Treasury’s cost of borrowed funds. They are also far higher than the

average rate of return on electric utility investments (under 14 percent nominally in 1991). A lower rate more

consistent with cost of funds would result in higher estimates of savings potential. Although this study focuses on

highly attractive economic measures, it does not intend to suggest that a high discount rate is appropriate in

analyzing Federal energy efficiency opportunities.

IFOr m ~-dep~ ds~us$ion of the practicaI aspects of economic analysis of energy inwstments, see U.S. ~epmrnmt of Commerce,

National Bureau of Standards {now called the National Institute of Standards and Technology), Comprehensive Guide for Lea.sf-Cmt Energy

Decisicvw, NBS Special Publication 709 (Wasbingtou DC: U.S. Government Printing OffiW, 1987).

Also, for a handbook tailored for use by Federal agencies, see U.S. Department of Commerce, National Bureau of Standards, L~e-CycZe

Costing Munwlforthe Fe&ralEnergy MunagementProgram, NBS Handbook 135 (Rev. 1987) (Washington, DC: U.S. Government Printing

Offke, 1987),

2For @e Ii@@g re~ofit example saving $40,000 annually, the project is economically attractive whether the discount mte h 3 perc~t

or 10 percent. But if it saves $12,000 annually, it is attractive only if the discount rate is below about 8.4 pereent.

~F~eral Energy Mnagement Improvement Act, 1988, Public Law 100-615.

410 CTI? 436, as revised November 1990.

authority estimated that cost-effective savings of at

least 30 percent could be realized.

Studies of weatherization programs in both public

housing and other low-income housing (i.e., those

funded by HHS and DOE) have found considerable

savings potential, although results are variable. To

gain abetter understanding of the potential gains and

best methods to use, DOE’s Weatherization Assistance Program recently began a comprehensive

3-year, $5-million review of performance. This

analysis should help identify the economically and

technically most effective programs for the future.

Energy- and cost-saving opportunities for appliances exist in all types of federally owned and

assisted housing as well. For example, a simple

program of using the most efficient and economic

new refrigerators available, perhaps coupled with

early refrigerator retirement, offers the prospect of

reducing electricity used in federally assisted residences by a few percent. It would also encourage and

support private sector development and commercialization of new, more efficient refrigerators. Such an

early retirement program for other appliances such

as water heaters and air conditioners could also save

both gas and electricity cost-effectively. Of course,

energy efficiency and cost are only two of several

attributes (e.g., durability, features, operating performance) to consider when selecting any appliance

or equipment.

Savings Prospects in Passenger Vehicle

and Truck Fleets

As in the case with the Federal Government’s

owned and leased facilities, further efficiency gains

appear possible. For example, for 1991 GSA’s

Automotive Commodity Center has contracted to
10 ● Energy Efficiency in the Federal Government: Government by Good Example?

purchase 13,000 passenger sedans with EPAestimated mileage of 26 combined, all with automatic transmission.9 There are other vehicles in the

class that have better mileage ratings, including four

domestically produced models which get 27 mpg

with an automatic transmission. The manual transmission versions get 28 mpg. However, performance, first cost, and resale value all differ, complicating any assessment. Other, more novel efforts such

as increasing the Federal Government’s teleconferencing capabilities appear to have both energy and

nonenergy benefits in reducing some types of travel.

Several experimental programs with alternative

fuels and vehicle designs are underway in Federal

agencies. For example, the Interagency Fleet Management System currently operates 25 methanol

flexible-fuel sedans, with 40 more to be placed into

service in the near future. Also, a procurement for

light trucks fueled by compressed natural gas is

under way.

Savings Prospects in Other Operations

Because of the highly specialized nature of other

operations energy use (primarily military mobility),

examination of opportunities for energy and cost

savings there are largely beyond the scope of this

report. However, there are energy-saving activities

and opportunities even in military mobility, although not performed primarily to save energy. For

example, there are many flight simulators in use by

the Department of Defense. They supplement actual

flying time to allow for improved pilot training with

greater safety and lower cost. Part of the cost savings

results from greatly reduced fuel consumption (e.g.,

fighter aircraft may consume more than 1,000

gallons of jet fuel each hour). Similarly, there are

simulators for surface vehicles such as tanks. Although the use of simulators increases electrical

load, this is far more than offset by the reduction in

petroleum consumption.

CONSTRAINTS TO IMPROVED

FEDERAL ENERGY EFFICIENCY

How is it possible that large energy- and costsaving opportunities remain untapped by the Federal

Government? There is no single, simple explanation. However, there are several constraints to more

Table l-l-Constraints on Improved

Federal Energy Efficiency

Resource constraints

Priorities favor other agency needs

Energy efficiency is not central to most agencies’ missions

Energy is a small component of most agencies’ expenditures

Little senior management interest

Many measures require initial capital spending

Many measures require personnel

Many facilities have no energy coordinator

Information constraints

Opportunities have not been systematically assessed

Agencies are uncertain of technical and economic performance

Does this technology really work?

Would the facility be better off waiting for next year’s model?

Lack of metered energy-use data

Too little information sharing between agencies

Energy-use decisions are dispersed, made by thousands of

individuals

Implementation requires coordinated effort from diverse parties

Too little training and education for diverse parties

Lack of Incentives

Dollar savings often do not accrue to energy savers

Energy costs are readily passed through budgets

Federal procurement policies often favor status quo

Procurement practices are complex, often restrictive

SOURCE: Office of Technology Assessment, 1991.

effective energy efficiency efforts, some major and

some minor.

Constraints to improved Federal energy efficiency can be grouped as either: 1) funding and

personnel limitations largely reflecting energy efficiency’s relatively low priority, 2) a lack of information about the available opportunities, or 3) incentives which do not encourage efficient energy

management (see table l-l).

It is important to note that despite the constraints,

there are many examples of highly motivated

Federal employees who find ways to save energy

and money for the government, and take advantage

of whatever energy efficiency opportunities they

can. Winners of the annual Federal Energy Efficiency Awards presented by DOE’s Federal Energy

Management Program are good examples. The best

practices found in Federal facilities demonstrate

that, although there are constraints to improving

Federal energy efficiency, none are fundamental

obstacles which cannot be overcome.

%s represents only a portion of the automobiles to be purchased in 1991. Also, note that the Corporate Average Fuel Economy requirement is 27.5

mpg.
Chapter 1--Introduction and Summary ● 11

Resource Constraints

Adequate, stable funding is a common constraint to improved Federal energy efficiency.

Many energy- and cost-saving projects such as

replacing lamps and fixtures require a commitment

of funding, including annual operating and maintenance costs or initial capital costs, or both. However

funding for energy efficiency investment is often in

short supply not only in the Federal Government, but

in the private sector as well. Many energy efficiency

projects have rapid paybacks of 3 years or less,

representing a return on investment far higher than

the Treasury’s cost of funds. Despite these opportunities, Federal agencies have not sought and have not

received a stable source of funding for even their

most productive energy efficiency projects over the

years, reflecting the low priority placed on energy

efficiency. For example, the total capital budget

earmarked specifically for energy efficiency projects in federally owned facilities dropped from a

high of $297 million in 1981 to under $50 million in

1990, a decline of over 80 percent in nominal dollars

(see figure 1-3).10 Adjusted for inflation, the decline

in conservation investments between 1981 and 1990

has been nearly 90 percent. That trend has begun to

reverse, with GSA and DOD alone increasing their

energy efficiency investments from under $7 million

in fiscal year 1989 to $40 million in fiscal year 1991.

There are two main private sector supplements to

direct Federal funding. Participation in utility rebate

programs is one source of private sector funding

which the Federal Government has recently begun

exploring. In these programs, utilities encourage

their customers to use more efficient devices or

operating strategies, which can help the utility avoid

the cost of building new powerplants. Utility programs may provide engineering expertise as well as

funding. Prospects for increasing Federal participation in utility efficiency programs are excellent,

with both utilities and the government benefiting.

Another private sector funding source is shared

energy savings (SES) contracting, which has been

promoted in the Federal Government since 1986.

Under SES contracts, private companies use their

own capital and personnel to perform energy efficiency improvements. Their services may include

Figure 1-3—Direct Federal Energy Efficiency

Funding, Fiscal Years 1976-90

Millions of nominal dollars

350 ~~

300

250

200

150

100

50

0

76 77 78 7980 81 82838485 8687888990

& prior plan

Fiscal year

Agency

= Defense = Energy ~ V A

m USPS = GS A i%%%% Other

SOURCE: U.S. Department of Energy, Federal Energy Management

Program, “Annual Report to Congress on Federal Government

Energy Management and Conservation Programs, ’’fiscal years

1981 -89; and “Federal Ten-Year Building Plan,” DOE-CE-0047,

September 1983.

energy audits, purchase and installation of new

equipment, efficient operation and maintenance of

equipment, and training of personnel. In exchange,

the contractors receive a specified portion of the cost

savings for a number of years. This system provides

agencies a private-sector alternative to Federal

funding and staffing for energy efficiency investments, although by sharing the savings, it reduces

the government’s total cost-saving potential (since

those savings are shared).

Only four SES projects had been implemented by

the end of 1990, representing a small fraction of the

thousands of major Federal facilities. Federal agencies are becoming increasingly familiar with the

SES approach and the program has been revised to

provide expanded incentives for military facilities,

but some implementation questions remain. Among

them are whether current incentives are adequate to

encourage greater use, and whether the contracts can

be sufficiently simplified despite the need for terms

such as the design of payment provisions tied to

projected or actual energy savings and energy prices.

In addition to capital investment and at least as

important, most energy- and cost-saving projects

require a commitment of well-trained personnel.

Personnel familiar with energy efficiency opportunilmote that some ener~ efficiency projects maybe combined tith major maintenance, so total etllciency spending is higher than this indicates. For

example, when a roof needs repair, adding insulation is often part of the projecg although the projeet is not labeled as an energy efilciency effort.

Similarly, when a boiler fails and is replaced, use of a higher efficiency unit may be considered normal maintenance and not an eftlciency investment.
12 ● Energy Efficiency in the Federal Government: Government by Good Example?

ties are needed at all levels, from the operations

crews at a facility to the decisionmaking management of the agency. As in the case of funding,

qualified personnel are typically in short supply,

reflecting the low priority placed on improving

energy efficiency. Among the most important personnel for identifying, implementing, and following

through on energy efficiency measures are energy

coordinators at individual facilities or in regional

offices. However, many Federal facilities have no

explicit, trained energy coordinator. Energy efficiency projects, to the extent they are developed, are

pursued in the spare time of facility staff. Typically,

this staff is charged with other critical missions, such

as maintaining and operating existing equipment.

Often, they have many additional projects which

they could pursue depending on priorities, ranging

from addressing environmental and safety hazards

such as transformers laden with PCBs and asbestos

floor tiles to planning for new facilities.

Information Constraints

One obvious information constraint is the lack of

coordinated, comprehensive estimates of both the

potential energy and cost savings and the capital

and other resources required to attain those

savings in federally owned facilities and operations. Information about potential savings and costs

is basic both for determining whether additional

energy efficiency efforts are worthwhile and if so,

for program planning and budgeting. The absence of

basic, governmentwide information of this type

appears to be a serious shortcoming in current

Federal energy management efforts.

In contrast to the lack of information for federally

owned facilities, HUD has produced estimates of the

potential energy and cost savings as well as the

investment required in HUD-assisted housing. HUD’s

studies provide a basis for internal HUD planning as

well as congressional budget requests,

Uncertainty about the economic and technical

performance of some energy efficiency technologies constitutes another information constraint.

Does this technology really work? Would the

facility be better off waiting for next year’s model,

which may have fewer bugs, cost less, and perform

better? Since many energy efficiency measures are

relatively new and not industry standard practice,

these are eminently reasonable questions. Furthermore, the lack of detailed, metered data on energy

Photo credit: Pacific Northwest Laboratory

Mobile energy laboratories provide expertise and

equipment to assist energy efficiency efforts

at Federal facilities.

use in Federal facilities complicates analysis of

prospective measures and monitoring results of

implemented measures. For example, some military

bases may have only a few meters monitoring the

energy use of thousands of buildings.

Uncertainty is at least partly in the mind of the

user and can often be reduced through training and

information sharing. Even well-demonstrated measures such as lights linked to occupancy sensors may

be unfamiliar to a facility manager. Using any

technology besides that which is already in place can

entail some risk since no facility engineer wants

complaints of inadequate lighting, or of buildings

too hot in summer and too cold in winter. Nor do

facility staff want to spend money and time unnecessarily on unproductive measures. Despite the wealth

of diverse experiences with energy management

techniques in Federal facilities, much more remains

to be done to share the knowledge gained in those

experiences.

The Federal procurement system often does not

help reduce uncertainty. For example, for many

commonly used items available through the Federal

Supply System, there is little information comparing

their life-cycle energy and economic characteristics.

Similarly, facility engineers are given little information about the performance of light bulbs, which are

supplied by DOD’s Defense Logistics Agency. In

contrast, GSA’s Household Appliances Schedule,

which includes products such as refrigerators, water

heaters, and room air conditioners, lists items

identified as having the lowest life-cycle cost. Often,
Chapter 1---Introduction and Summary ● 13

the only information on product performance is that

provided by the vendors. A purchaser must be aware

of the opportunities for energy savings, and be

willing to dedicate time and effort to learning about

the alternative products. In absence of awareness,

time, and effort, purchasers may be expected to

continue to use standard replacement products rather

than new energy efficient equipment.

The large number and diversity of parties

involved in energy-use decisions exacerbates

information constraints two ways. First, for many

energy efficiency projects, the activities of the

diverse parties need to be carefully coordinated to

ensure that project conception, design, budgeting,

and implementation all take place. That involves a

considerable flow of information about engineering,

economics, funding, and staffing between a wide

range of agency personnel. Second, education and

training about the opportunities and performance of

energy-efficiency measures must be diverse, reflecting the diverse information needs and perspectives.

Developing appropriate education and training programs requires considerable effort. For example,

boiler operators and mechanics need to be aware of

the importance of maintenance programs, as well as

the specific mechanical steps required for their

boilers. Facility managers and agency management,

on the other hand, do not need to know how boilers

and other equipment work. However, to make

appropriate manpower and budgeting decisions,

they need to be aware of the importance of energyrelated maintenance programs in minimizing operating costs of a facility.

Lack of Incentives

Neither rewards nor penalties have been widely

and systematically used in the Federal Government to encourage energy efficiency. There are

notable exceptions (e.g., GSA’s bonuses for facility

personnel), but generally, facility managers have

neither rewarded nor penalized staffs; regional and

headquarters offices neither rewarded nor penalized

facilities; and Congress neither rewarded nor penalized agencies. The lack of incentives contributes to

the low priority placed on energy efficiency. Recently enacted incentives for DOD facilities should

greatly reduce this constraint, if properly implemented.

The complexity of the Federal Government’s

procurement system creates some disincentives

to use of new energy- and cost-saving measures.

Federal procurement is naturally complex, reflecting

the diverse goals of the process. While the foremost

goals are ‘‘economy, efficiency and effectiveness,”

also included are socioeconomic development (e.g.,

for small, disadvantaged businesses), and efforts to

promote competition and to protect against fraud

and abuse. Together with the diversity of products

and services noted above, the result is a complex

system. Difficulties of identifying and then justifying the use of novel energy-efficient products and

services can be a built-in disincentive to change.

POLICIES FOR FEDERAL

ENERGY EFFICIENCY

Since the 1970s, both the executive branch and

Congress have worked to promote energy efficiency

within Federal agencies. Each new piece of legislation or program has combined past experience with

new approaches in an effort to promote further

efficiency gains in Federal agencies. Executive

Order 12759, signed on April 17, 1991, is the most

recent example of the ongoing Federal effort.

Despite the array of programs developed over the

past 15 years, the Federal Government still has many

cost-effective opportunities to improve energy efficiency in its facilities and operations.

There are good reasons for Congress’ continuing

interest in Federal energy efficiency. The potential

benefits include:

1.

2.

3.

4.

5.

promoting use of energy efficient measures

throughout the economy by demonstrating

their cost and performance;

accelerating manufacturers’ development of

energy efficient technologies, again for use

throughout the economy not just in the Federal

Government;

learning first-hand which approaches work as a

basis for national policy (e.g., while the Federal

government is not entirely analogous to the

private sector, many of the constraints on

Federal energy efficiency and their solutions

pertain to the private sector);

reducing Federal spending without reducing

services; and

reducing energy-related environmental and security problems.
14 ● Energy Efficiency in the Federal Government: Government by Good Example?

However, while the benefits of improved Federal

energy efficiency can be great, there are costs as

well. The effort involved can be considerable,

requiring initial capital investment, allocation of

staff, and the attention of Congress and senior

executive branch personnel.

Options for Improving Federal Efficiency

Just as there is no single constraint explaining the

failure to harness many opportunities, there is no

single, simple policy that will ensure greater energy

efficiency in the Federal Government. Fortunately,

none of the constraints pose fundamental obstacles;

rather, all can be addressed by a variety of initiatives.

Some new initiatives involve simply making widespread use of the best practices found in individual

facilities today.

Table 1-2 lists several options Congress could

consider for Federal energy management. The default option, maintaining the status quo, will

capture only a fraction of the potential gains. If

Federal energy efficiency is viewed as worth pursuing more vigorously, dedicating resources to it in

the form of staffing and investment funding is

essential. Dedicating resources naturally entails

initial costs, although those should be rapidly paid

back by reduced energy costs. Several other potentially useful options such as setting standards of

performance, revising procurement policies, and

creating incentives for agencies and personnel require modest or negligible initial costs and are

grouped here as encouraging agency efforts. Finally, promoting research, development, and

demonstration can be useful not only in developing

new energy efficient technologies, but for ensuring

that current experiences translate into improved

policies for the future.

Maintaining the Status Quo

Current Federal efforts together with a general

improvement in the efficiency of HVAC and lighting equipment on the market should help to gradually improve Federal energy efficiency. However,

the improvements will be only a fraction of the

available cost-effective energy- and cost-saving

measures. At the current low level of energy

efficiency funding and staffing for individual agencies, it would take decades to make all the economically attractive investments. During that time, tens

of billions of dollars would be unnecessarily spent to

buy inefficiently used energy.

Table 1-2—Policy Options for Federal

Energy Efficiency

Maintaining the status quo

Dedicating resources

Increasing funds for investment

Supporting an adequate staff: using money wisely

Encouraging agency efforts

Setting standards for performance

Rewarding agencies and individuals for energy and

and cost savings

Revising procurement: information, life-cycle costing,

and simplification

Following through and enforcing

Promoting research, development, and demonstration

SOURCE: Office of Technology Assessment, 1991.

Dedicating Resources: Higher Priority

for Energy Efficiency

There are several billion dollars’ worth of

highly cost-effective energy-efficiency investment

opportunities in federally owned and assisted

buildings. Many of these measures have very high

returns on investment, several times higher than the

Treasury’s cost of funds. It appears that a gradual

increase in Federal investment at least to the level of

the early 1980s could produce high returns for the

foreseeable future. One novel method of funding

which could be considered is a revolving loan fund.

Also, to help ensure that funding levels are appropriate, the Federal Energy Management program could

be required to provide estimates of the governmentwide potential energy and cost savings and the

capital investment required to attain those savings in

its annual report to Congress.

Adequate funding alone is not enough to assure

the greatest energy and cost savings for the Federal

Government. It is at least as important to have a

trained, competent, and motivated staff at individual Federal facilities, in central and regional

agency offices, and in offices such as FEMP

dedicated to successful implementation of energysaving measures. As one step to ensuring appropriate staffing, Congress could require the agencies, the

Office of Personnel Management, and FEMP to

report on agency staffing (as well as investments) in

FEMP’s annual report to Congress. DOE’s expertise

in applying energy efficiency measures (e.g., the

Institutional Conservation Program) could be a

useful supplement to agency staff.
Chapter I-introduction and Summary ● 15

Encouraging Agency Efforts

Setting Standards--Some existing minimum standards or requirements for energy efficiency could be

expanded. For example, Federal agencies are required by the Federal Energy Management Improvement Act of 1988 to reduce energy consumption in

their existing buildings by 10 percent in 1995

relative to 1985. That requirement filled a void left

when the energy-saving targets of Executive order

12003 lapsed in 1985. It is a modest goal, less by at

least a factor of two than should be readily achievable using current commercial measures. Nevertheless, extending this requirement beyond 1995 together with a new minimum savings target based on

life-cycle costs could help promote greater continuity in Federal energy efforts. Also, the standard

could be expanded to include energy used in

operations. The goals set by Executive Order 12759

provide agencies with valuable guidance. However,

they are not based on an analysis of existing

opportunities and could potentially be strengthened.

Creating Incentives--Creating more rewards for

Federal agencies and for facility staff that successfully pursue energy-and cost-saving measures is one

way to promote implementation of efficiency efforts. Although incentives for energy performance

have been the exception rather than the rule in

Federal facilities, the exceptions are useful models

which could be more broadly applied. For example,

the incentives for DOD facilities included in the

National Defense Authorization Act for fiscal year

1991 could be expanded to other agencies. DOD’s

new incentives need to be monitored to ensure that

they are being properly and fully implemented, and

revised as necessary. Also, part or all of GSA’s

bonus program for facility personnel in its National

Capitol Region may be worth replicating in other

regions and other agencies. Key issues in establishing an incentive system include which facilities and

personnel should be eligible for awards, the methods

used to demonstrate that energy and cost savings

actually occur, the amount of the awards, and in the

case of agency incentives, possible restrictions on

the use of incentive funds.

Revising Procurement--Some Federal procurement policies could be revised to encourage greater

use of energy efficient products and services. There

are several possible changes in the procurement

system which may be worth considering. One

possibility is to provide information on energy use

characteristics of products provided to agencies by

the Federal Supply Schedule Program, through the

Federal Supply Catalog managed by GSA, and of the

lighting products provided by the Defense Logistics

Agency. A second possible procurement change is to

increase the use of life-cycle costing when selecting

goods and services ranging from light bulbs and

ballasts to service contracts for HVAC equipment

operation and maintenance. A third possibility is to

simplify some procurement policies for new energy

efficient products and services. This is particularly

important since many energy efficiency measures

are relatively new. For example, changing the

regulations governing SES contracts to simplify

them and increase agency flexibility may help

promote that novel form of private financing of

Federal efficiency measures.

Following Through and Enforcing--Finally, following through on Federal energy management

programs is essential to achieving full energy- and

cost-saving potential. Ongoing congressional attention helps raise the priority of energy efficiency

efforts within Federal agencies. To further demonstrate ongoing interest, Congress could consider

encouraging regular or occasional reports by inspector generals at the key agencies with most responsibility for Federal energy use and management.

Promoting Research Development

Continuing and possibly expanding research,

development, and demonstration (RD&D) efforts is

important to innovation and the practical application

of new energy efficient measures. But even for

economically attractive new commercial products,

gaining consumer acceptance and widespread use

both within the government and the private sector

takes considerable time and could benefit from

increased demonstration efforts and information

sharing. Research into preferences and perspectives

of facility managers can be useful in developing

programs which best deliver energy- and cost-saving

technologies. By demonstrating the cost and performance of efficient technologies and operating

strategies to the maximum cost-effective potential in

at least some of its own facilities, the Federal

Government could help reduce the risk and uncertainty perceived by managers both in other Federal

facilities and in the private sector.
Chapter 2

Policies

Federal

and Programs for

Energy Efficiency
Contents

Page

SETTING GOALS: LEGISLATION AND EXECUTIVE ORDERS PROMOTING

FEDERAL ENERGY EFFICIENCY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Legislation for Federal Facilities and Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Legislation for Households Receiving Federal Energy Subsidies . . . . . . . . . . . . . . . . . . . 21

Executive Orders for Federal Energy Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22

. . PROGRAMS FOR IMPLEMENTING CONGRESSIONAL

AND EXECUTIVE POLICY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24

DOE’s Federal Energy Management program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24

Life-Cycle Costing for Procurement . . . . +. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

Shared Energy Savings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27

Utility Rebate Programs . . . . . . . . . . . . . +.... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30

Energy Performance Standards for New Federal Buildings . . . . . . . . . . . . . . . . . . . . . . . . . 30

Energy Audits and Surveys of Existing Federal Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . 31

Key Agencies’ Energy Management Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .31

Boxes

Box Page

2-A. Energy Training Courses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .,.. ... ., s....,....,..,,, 26

2-B. Life-Cycle Cost Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . 28

2-C. Examples of Efforts To Implement Federal Shared Energy Savings Contracts . . . . . 29

Figure

Figure Page

2-1. Percent Change in Building Energy Use per Square Foot, Fiscal Years

1975-85 and 1985 -89 . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . 32

Tables

Table Page

2-1. Federal Energy Management Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

2-2. Governmentwide Approaches to Energy Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Chapter 2

Policies and Programs for Federal Energy Efficiency

Since the 1970s, both the executive branch and

Congress have worked to promote energy efficiency

within Federal agencies, although policy emphasis

has varied. This chapter first examines legislative

and executive efforts to implement an energy

conservation strategy for the Federal Government.

Next it describes the major energy efficiency programs of Federal agencies intended to implement

congressional and executive policy.l

SETTING GOALS:

LEGISLATION AND EXECUTIVE

ORDERS PROMOTING FEDERAL

ENERGY EFFICIENCY

Legislation for Federal Facilities and

Operations

Congress has visited the issue of improving

energy efficiency in the facilities it owns and leases

and in its operations several times since the rnid1970s. Each new piece of legislation has combined

past experience with new approaches in an effort to

promote further efficiency gains in Federal agencies.

Table 2-1 summarizes the main acts of Congress

regarding Federal energy management legislation,

and the key provisions.

Energy Policy and Conservation Act (EPCA)

—EPCA of 1975 was the first major piece of

legislation to address Federal energy management,

directing the President to develop a comprehensive

energy management plan including procurement

practices and a 10-year building plan. EPCA included few details, leaving those to the executive

branch. EPCA also amended the Motor Vehicle

Information and Cost Savings Act to require that the

Federal automotive fleet meet or exceed the corporate average fuel economy mileage standards.

Department of Energy Organization Act

(DOEOA)----Section 656 of the DOEOA of 1977

established the Federal Interagency Energy Policy

Committee (often called the “656 Committee”).

The 656 Committee is a senior agency management

group comprised of an assistant secretary or assistant administrator from each of the Departments of

Defense, Commerce, House and Urban Development, Transportation, Agriculture, and Interior;

from the U.S. Postal Service and from the General

Services Administration. The National Aeronautics

and Space Administration and the Department of

Veterans Affairs have also designated members for

the committee. This committee meets periodically to

discuss policy options and review agency progress

toward Federal conservation goals. The committee

is intended to strengthen energy conservation programs which emphasize productivity through the

efficient use of energy and to concurrently encourage interagency cooperation in energy conservation.

One of its purposes is to focus the attention of top

Federal agency management on the tasks and

missions related to national energy objectives rather

than on the tasks of a particular agency.

National Energy Conservation Policy Act

(NECPA)—In NECPA of 1978, Congress took a

more active role in defining detailed steps to be

followed by the executive agencies. Several of the

steps included in this legislation had been set forth

by the President in Executive Order 12003 in 1977

(see below). For example, where EPCA directed the

President to develop an energy-related procurement

policy, NECPA specified the use of a “life cycle

costing methodology” as the basis of policy. Similarly, where EPCA directed the President to develop

a 10-year building plan, NECPA included details

such as which buildings were subject to energy

audits (all those exceeding 1000 square feet). Both

of these provisions in NECPA were part of Order

12003. Unlike Order 12003, NECPA set no goal for

percentage reduction in energy use, but instead

specified the minimum rate at which Federal buildings had to be retrofit with all cost effective

measures. All buildings were to have been retrofit by

lrn tidition to the efforts to improve Federal energy efficiency, Congress and the Department of Energy are Wormg to promote energy efficiency

throughout the economy at large. These efforts will produce increased eftlciency for the Federal Government as well. For example, the National

Appliance Energy Conservation Act, with energy eftlciency standards for products ranging from refrigerators to fluorescent light ballasts, will result

in energy savings over time as agencies replace existing equipment.

–19–
20 ● Energy Efficiency in the Federal Government: Government by Good Example?

Table 2-l—Federal Energy Management Legislation

Law Purpose Provisions for Federal Energy Management

EPCA 1975

DOEOA 1977

NECPA 1978

COBRA 1985

FEMIA 1988

NDAA for

FY89,

Sec. 736

1988

NDAA for

FY90

Sec. 331

1989

NDAA for

FY91

Sec. 2851

1990

To increase domestic energy supplies

and availability; to restrain energy

demand; to prepare for energy

emergencies.

Establishes department of energy to

secure effective energy

management and a coordinated

national energy strategy.

Promote the use of commonly

accepted methods to establish and

compare life-cycle costs of

operating Federal buildings, and

the use of solar heating and cooling

and other renewable energy

sources in Federal buildings

Reconcile the budget.

Promote efficient use of energy by the

Federal Government.

Authorizes defense spending.

Same as above.

Same as above.

Directs President to:

—Develop mandatory standards for agency procurement policies with

respect to energy efficiency;

—Develop and implement 10-year plan for energy conservation in Federal

buildings, including mandatory lighting, thermal, and insulation standards,

and plans for retrofitting to meet standards.

Requires that Federal vehicle fleet meet corporate average fleet efficiency

standards.

Establishes “656” Committee.

Defines Federal Energy Initiative (FEI).

Establishes use of life-cycle cost (LCC) method.

Establishes publication of Energy Performance Targets.

Requires LCC audits and retrofits of Federal buildings by 1990.

Establishes Federal Photovoltaic Program.

Establishes Federal Solar Program.

Amends FEI authorizing agencies to use shared energy savings (SES).

Amends Federal Energy Initiative.

Allows Secretary of Energy to set discount rate used in LCC analysis.

Removes requirement that agencies perform LCC retrofits by 1990.

Establishes energy performance goals for Federal buildings, including a

10% reduction in building energy use by 1995.

Directs agencies to establish incentives for energy conservation.

Creates Interagency Energy Management Task Force on Federal energy

management.

Establishes incentive for SES contracts in DOD, allowing half of first year

savings to be used for welfare, morale, and recreation activities at facility.

Other half to be used for additional conservation measures.

Expands DOD’s SES incentive to include half of first 5 years’ savings.

Requires Secretary of Defense to:

—Develop plan “to achieve maximum cost-effective energy savings;”

—Develop simplifed contracting method for SES;

—Report annually to Congress on progress made.

Expands DOD incentives to include utility rebate programs and include

two-thirds of savings.

KEY: EPCA—Energy Policy and Conservation Act, 1975, Public Law 94-163.

DOEOA—Department of Energy Organization Act, 1977, Public Law 95-91.

NECPA-National Energy Conservation Policy Act, 1978, Public Law 95-619.

COBRA-Comprehensive Omnibus Budget Reconciliation Act, 1985, Public Law 99-272.

FEMIA—Federal Energy Management Improvement Act, 1988, Public Law 1004515.

NDAA-National Defense Authorization Acts: for FY 1989, Public Law 100-456; for FY90, Public Law 101-189; for FY91, Public Law 101-510.

SOURCE: Office of Technology Assessment, 1991.

1990. The main provisions of NECPA were codified COBRA, agencies were encouraged to seek private

as the Federal Energy Initiative.2

financing and implementation of energy efficiency

Comprehensive Omnibus Budget Reconcilia- projects through ‘‘shared energy savings’ (SES)

tion Act (COBRA)--COBRA of 1985 amended contracts (described below).

NECPA to provide Federal agencies an alternative Federal Energy Management Improvement

source of funding for energy efficiency investments Act (FEMIA)—FEMIA of 1988 amended NECPA

during a time of great fiscal constraints. Under and modified and added several provisions to the

242 U.S. (l& 8243-8287 (1983).
Chapter 2--Policies and Programs for Federal Energy Efficiency ● 21

Federal Energy Initiative. A central provision was

the establishment of a goal to reduce energy

consumption per square foot in Federal buildings by

10 percent between 1985 and 1995. Operations

energy (i.e., energy used for transport, or in energyintensive activities such as nuclear reactors) was not

included. FEMIA marked the frost time that Congress specified the level of savings which should be

achieved. Also, as an incentive to encourage use of

SES contracts, Congress allowed agencies to retain

a portion of cost savings for future energy conservation measures. Furthermore, FEMIA created an

Interagency Energy Management Task Force, and

directed the Department of Energy (DOE) to carry

out an energy survey in a representative sample of

Federal buildings to: 1) determine the maximum

potential cost-effective energy savings that may be

achieved, and 2) make recommendations for costeffective energy efficiency and renewable energy

improvements.

National Defense Authorization Acts for Fiscal

Years 1989-91 (NDAA)—NDAA for 1989 provided incentives for shared savings in military

facilities by allowing a base commander to use half

the first-year savings for welfare, morale and recreation activities of the base. NDAA for 1990 expanded

that incentive to cover the savings in the first 5 years.

NDAA for 1991 revised the incentive such that

one-third of the savings from SES contracts could be

used for additional energy conservation measures,

with one-third left for improving family housing at

the base or for welfare and recreation activities.

Further, these incentives apply not only to SES

contracts, but also to other energy cost savings (e.g.,

from participation in utility rebate programs). NDAA

for fiscal year 1991 also calls for simplified SES

contracting methods, explicitly allows military facilities to participate in utility rebate programs, and

directs the Secretary of Defense to develop and

report annually on a plan to achieve maximum

cost-effective energy savings through the year 2000.

Proposed Legislation-Congress has continued

to work for increased energy savings in Federal

facilities with ongoing hearings and proposed legislation. For example, the House Energy and Commerce Committee’s Subcommittee on Energy and

Power and the House Government Operations Committee’s Subcommittee on Energy, Environment and

Natural Resources held a joint hearing in July 1990

on energy conservation and efficiency efforts at

Federal facilities.3 In addition to hearings on the

issue, new legislation has been proposed. For

example, the proposed National Energy Policy Act

of 1990, which passed the Senate in August 1990,

included a goal of installing all conservation measures with less than a 10-year payback period in

Federal buildings. 4 Currently, there is proposed

legislation in both Houses which includes a variety

of provisions for improving Federal energy efficiency. 5 For example, several of these acts, if

enacted, would establish a fund to support energy

efficiency investments and direct agencies to perform energy- and cost-saving retrofits and create

new incentives.

Legislation for Households Receiving

Federal Energy Subsidies

Around two-thirds of the Federal Government’s

spending on energy is for Federal facilities and

operations. The other third is spent indirectly on the

utility bills of low-income households through

programs of the Departments of Housing and Urban

Development (HUD) and Health and Human Services (HHS).6 As with the Federal Energy Initiative,

legislative efforts to encourage increased energy

efficiency in HHS- and HUD-assisted households

have been ongoing and have evolved over time.

Energy Efficiency in HUD-Assisted Housing—

The Housing and Community Development Act

(HCDA) of 1974 placed an emphasis on energy

conservation and renewable energy. HUD was

directed to support activities related to energy,

including retrofits and installation of solar equipment in buildings, and to provide aid for the

assessment and design of district heating and cooling systems and resource recovery projects.

3u.s. ConweSS, House committee on Energy and commerce, Subcommittee on Energy and Power, and House COtittee on Gov~ent

Operations, Subcommittee on Environrnen~ Energy, and Natural Resources, Hearings on Federal Facilities Energy Conservation Programs, Serial No.

101-175, July 1990.

4s. 324 passed the Semte with an amendment by voice vote on Aug. 4, 1990 (Congressional Record, Aug. 4, 1990, pp. 12558-12596).

Ssee S. 163, in~duced Jan. 14, 1991; S. 326, introduced Jan. 31, 1991; S. 341, introduced Feb. 5, 1991; S. 417, in~oduced Feb. 7, 1991; S. 570,

introduced Mar. 6, 1991; S. 741, introduced Mar. 21, 1991; H.R. 776, introduced Feb. 4, 1991; H.R. 1196, introduced Feb. 28, 1991; H.R. 1301,

introduced Mar. 6, 1991; and H.R. 1543, introduced Mar. 21, 1991.

%ese programs are described in ch. 3.
22 ● Energy Efficiency in the Federal Government: Government by Good Example?

The HCDA of 1979 directed that HUD consider

life-cycle cost when selecting heating and cooling

systems in newly constructed and substantially

rehabilitated projects.7 The HCDA of 1980 required

the preparation of comprehensive, communitywide

energy use strategies. The HCDA of 1987 established an energy-efficient public housing demonstration project, allowed housing authorities to

retain part of the energy cost savings resulting from

shared energy savings projects, and required that

life-cycle cost be considered in HUD’s comprehensive improvement assistance program for housing

authorities.

The Cranston-Gonzalez National Affordable Housing Act of 1990 required that newly constructed

HUD-assisted housing meet energy efficiency standards. It also included a low-income housing conservation and efficiency grant, and required that HUD

submit an energy assessment report and a 5-year

energy efficiency plan.

Energy Efficiency in DOE and HHS-Assisted

Households—In 1989 HHS spent $1.4 billion on

residential heating and cooling assistance payments

through the Low Income Home Energy Assistance

Program (LIHEAP). Congress has established two

programs to improve energy efficiency in lowincome households. One is a weatherization component of LIHEAP. The other is DOE’s Weatherization

Assistance Program (WAP), which is not limited to

LIHEAP-eligible households, but targets generally

the same population. Under LIHEAP, the States are

allowed to use up to 15 percent of LIHEAP funding

for weatherization programs. In 1990, Congress

amended LIHEAP to allow States to request a

waiver to spend up to 25 percent of their LIHEAP

funds on weatherization under certain conditions.8

The maximum weatherization benefit ranged from

$160 to $5,000 in fiscal year 1990, which aided

about 160,000 households in weatherizing their

homes. In recent years, 8 to 10 percent of LIHEAP

funds have been used for weatherization. A relatively small number of LIHEAP-eligible households

receive weatherization. For example, in fiscal year

1989, less than six-tenths of 1 percent (or 142,584

households) received weatherization assistance.9

Since 1985 there have been substantial cuts in

LIHEAP funding, and use of LIHEAP for weatherization has decreased significantly. For example, in

the fiscal year 1992 budget request, HHS suggested

reducing the LIHEAP appropriation by one-third to

around $1 billion.10 Between fiscal year 1988 and

1990 the weatherization assistance component has

dropped by 22 percent, from $170 million to $133

million.

DOE’s WAP was established in 1977 by Title N

of the Energy Conservation and Production Act.ll

Through WAP, Congress directed the Secretary of

Energy to develop and conduct a weatherization

program that provides grants to States and Indian

tribes. Households with incomes below 125 percent

of the Federal poverty line (around $6,000 in 1988)

are eligible to have additional home insulation

installed. States often use LIHEAP weatherization

funds to supplement WAP. In 1988, 107,000 homes

were weatherized with a maximum average expenditure of $1,600 per housing unit. The appropriations

levels have remained relatively constant in recent

years, hovering around $160 million, although when

inflation is taken into account funding has fallen. 12

Executive Orders

for Federal Energy Efficiency

Executive Order 11912—There have been five

Executive orders related to Federal energy efficiency. The earliest was Order 11912 of 1976,

Delegation of Authorities Relating to Energy Policy

and Conservation. Among other things, this order

defined the roles of various Cabinet Departments

with responsibility for Federal energy use:

. the Administrator of the General Services

Administration (GSA) was designated to take

on the functions assigned to the President by

742 U.S.C. 1437k (1990, Cumulative Annual Pocket Part).

s~blic hW 101-501, NOV. 3, 1990.

~.S. Department of Health and Human Services, Family Support Administration, Low Income Home Energy Assistance Program Report to

Congress for Fiscal Year 1989, Oct. 29, 1990, p. ix.

lw.s. ofilce of M~gement and Budge~ Budget of the United States Government Fiscal Year 1992 (Washington DC: U.S. Governmentprinting

office, 1991), Part 4-667.

1142 U.S.C. 6851 (1983).

12Mary F. Smith and Joe Richardson Library of Congress, Congressional Research Service, ‘‘CRS Report to Congress: Weatherization Assistance

Programs of the Departments of Energy and Health and Human Services,” June 6, 1990, p. 4.
Chapter 2--Policies and Programs for Federal Energy Efficiency ● 23

the Motor Vehicle Information and Cost Savings Act, as amended, directing that rules be

established to require the Federal fleet to

achieve an average fuel economy of at least that

applicable to vehicle manufacturers;

the Administrator of the Federal Energy Administration (now the Secretary of Energy) was

made responsible for coordination of a 10-year

energy conservation plan for Federal buildings,

energy conservation and rationing contingency

plans, and preparation of annual reports to be

submitted to Congress as required by EPCA;

and

the Administrator of the Office of Federal Procurement Policy was required to provide policy

guidance for application of energy conservation and efficiency standards in the Federal

procurement process as mandated by EPCA.

Executive Order 12003--Order 12003, issued in

1977, amended Order 11912 and aggressively expanded the requirements of the Energy Policy and

Conservation Act of 1975. For example, it specified

a goal of a 20-percent reduction in energy use per

square foot in existing Federal buildings, and

required the Federal automobile fleet to exceed the

minimum statutory requirement by 4 miles per

gallon beginning in fiscal year 1980. As noted

above, some of its provisions are also found in

NECPA. Key provisions of Order 12003 include the

following:

. The Administrator of the Federal Energy Administration (now the Secretary of Energy) was

directed to:

1. develop, implement and oversee a 10-year

energy conservation plan for Federal buildings over 5,000 square feet for the 1975-85

period which would achieve a 20 percent

reduction in energy use in existing buildings

and a 45 percent reduction in all new

buildings; 13

2. establish a life-cycle-cost methodology; and

3. report to Congress annually on the progress

of the plan.14

. The Administrator of GSA was directed to

ensure that:

1.

2.

3.

all passenger automobiles purchased by executive agencies exceed the manufacturers’

corporate average fuel economy standard

under the Motor Vehicle Cost and Information Act;

the Federal passenger automobile fleet exceed minimum statutory requirements by 2

miles per gallon in fiscal year 1978, and by

4 miles per gallon beginning in 1980; and

the Federal light truck fleet also meet minimum standards, although not required under

the Motor Vehicle Cost and Information Act.

Executive Order 12083-In 1978, Order 12083

created an Energy Coordinating Committee, composed of the Secretaries of the major Federal

agencies. Its mission is to assure Federal coordination on energy-related matters, including both policy

initiatives and resource allocation. In addition to the

committee, an Executive Council was formed—

consisting of the Secretary of Energy, Chairman of

the Council of Economic Advisers, Assistant to the

President for National Security Affairs, and the

Assistant to the President for Domestic Affairs and

Policy-to fulfill the functions of the committee

during periods when the committee is not meeting.

Executive Order 12375--Order 12375 of 1982

further amended Order 11912 to reduce the required

Federal passenger automobile fleet efficiency established in Order 12003. Whereas Order 12003

required the Federal passenger fleet to exceed

manufacturers’ average fleet efficiency by 4 miles

per gallon, Order 12375 required only that the

Federal fleet meet the manufacturers’ average efficiency and that light trucks meet standards set by the

Secretary of Transportation.15 This Executive order

contrasted sharply with Order 12003, which was far

IsNote, as specwled in 10 CFR 436 which interprets the Executive order, agency goals and reports are based on both enelgy used at tie somm and

energy used at the site. The distinction applies to electric energy use to account for efficiency losses in generatio~ transmissio~ and distribution. While

eachkilowatt-hour of electricity is equal to 3,412 BtUS at the site, on average 11,600 Btus of fossil fuels are required to generate and deliver it. The source

accounting system makes each unit of electric energy 3.4 times as important as each unit of fossil energy. Because source accounting reflects generation

and distribution losses, DOE’s reports have historicdy emphasized it. Beginning in 1990, agencies decided to emphasize energy use based on site rather

than source accounting in future reporting. Tiua Van Sickle, Federal Energy Management Program, U.S. Department of Energy, personal

communication% Mmch 1991.

1042 Federal Register 37523 (July 20, 1977).

1547 Federal Register 34105 (Aug. 4, 1982).
24 ● Energy Efficiency in the Federal Government: Government by Good Example?

more ambitious and went beyond some minimum

requirements set by Congress.

Executive Order 12759-On April 17, 1991,

Order 12759 was issued with provisions to:

●

●

●

●

●

●

●

extend the FEMIA Federal building reduction

goal to 2000, requiring Btu per gross square

foot to be reduced 20 percent from 1985 levels;

require agencies to prescribe policies for improving energy efficiency of industrial facilities by at least 20 percent in 2000 compared to

1985;

minimize petroleum use;

procure energy-efficient goods and products by

Federal agencies based on life-cycle cost;

provide for Federal agency participation in

demand-side management services offered by

utilities;

provide new Federal vehicle fuel efficiency

requirements, and outreach programs; and

promote procurement of alternative fuel vehicles for Federal fleet.

Development of the order, underway since 1989,

received considerable support from members of

Congress. For example, in April 1990, 19 Senators

sent a letter to President Bush urging the issuance of

a new Executive order, asking that the order direct

the Office of Management and Budget (OMB) and

Federal agencies to ‘‘implement cost-effective energy efficiency projects, including the steps necessary to encourage private sector and utility assistance in financing such projects. ’ ’16 In September

1990, 66 members of Congress sent a letter to the

Secretary of Energy again supporting an Executive

order. 1 7

PROGRAMS FOR

IMPLEMENTING

CONGRESSIONAL AND

EXECUTIVE POLICY

Each Federal agency is responsible for implementing energy management plans for its facilities

and operations as part of the Federal Energy

Table 2-2--Governmentwide Approaches to

Energy Efficiency

Coordination of Federal efforts by DOE’s Federal Energy

Management Program

Reporting on Federal energy management efforts

Providing information, training, and technical support

Hosting interagency committee meetings

Awarding certificates of achievement

Life-cycle costing for procurement

GSA’s Federal supply service

Defense Logistics Agency

Shared energy savings contracts

Utility rebate programs

Energy performance standards for new Federal buildings

Surveys of efficiency opportunities based on Iife-cycle costs

SOURCE: Office of Technology Assessment, 1991.

Initiative (see above). The approaches taken by the

individual agencies are diverse, reflecting the wide

range of their missions and perceived opportunities.

However, several programs, such as life-cycle cost

in procurement and SES, have broad relevance

across all Federal agencies. The main ones are listed

in table 2-2 and described in the following sections.

DOE’S Federal Energy

Management Program

The Federal Energy Management Program

(FEMP) within the Department of Energy is the

central mechanism that coordinates Federal energyefficiency efforts. It has several objectives, including:

●

●

●

●

encouraging better understanding of how energy is used in the Federal sector;

generating energy efficiency expertise, techniques, and practices and sharing them with

other agencies;

identifying key energy managers and Federal

decisionmakers; and

promoting effective energy management practices through training and awareness of these

managers.

18

FEMP has a leadership role in guiding other

Federal agencies to develop sound energy management practices, but has no responsibility for other

IGu.s. Dep~ment of Energy, “Federal Interagency Energy Management Task Force Holds First Meeting,” FederalEnergy Management Activities,

DOE/CE-0281P, Spring 1990, p. 7.

IWhe Honorable Philip R. Sharp et al., U.S. Congress, letter to the Honorable James D. Watkins, Secretary, U.S. Department of Energy, SePt. 11,

1990.

IW.S. Department of Energy, Office of Conservation and Renewable Energy, ‘‘Annual Operating Plan of Federal Energy Management Program,’

December 1989, p. 3.
Chapter 2-Policies and Programs for Federal Energy Efficiency . 25

agencies’ programs. It is a small office, with a staff

of six and annual funding averaging $1.5 million

between 1985 and 1990. FEMP’s 1991 appropriations have been increased to $3 million.

FEMP pursues a strategy ‘‘to seek those activities

that produce the maximum energy efficiency payoff

with minimum expenditures. 19 Currently, FEMP

has four areas of operations: 1) reporting on Federal

energy management efforts; 2) providing information, training, and technical support to Federal

agency personnel; 3) hosting interagency meetings

to develop new Federal initiatives (e.g., a new

Executive order); and 4) annually awarding certificates of achievement to Federal facilities and

personnel that have demonstrated exemplary performance.

Annual Report—Each year, FEMP produces a

report to Congress describing the Federal energy

management activities. Each executive agency reports quarterly and annually to FEMP on energy use

in its facilities and operations. FEMP compiles these

reports and publishes them in an annual report,

Federal Government Energy Management and Conservation Programs. The report is descriptive,

presenting statistics on energy use and spending by

agency, and summary information on Federal investments in energy efficient equipment and the

number of shared savings contracts entered into and

completed. The report contains no independent

analysis by FEMP staff and no discussion of the

existing opportunities for improving energy efficiency.

Information, Training, and Technical Support—

The bulk of FEMP’s efforts are in providing training

and technical support to other agencies. These

activities include publishing a quarterly newsletter,

publishing occasional guidebooks (e.g., Architect’s

and Engineer’s Guide to Energy Conservation in

Existing Buildings20), conducting training classes on

topics such as life-cycle cost and SES contracts, and

sponsoring four mobile energy labs for use by

Federal facilities.

The FEMP Update is a quarterly newsletter

distributed to over 5000 facility and management

personnel whose jobs are directly related to energy

use. Most of the articles in Update are submitted by

its readers, providing a forum for Federal personnel

to share their experiences with new energy efficient

technologies and programs. The dozen or so articles

in each issue describe a small but diverse sample of

the efforts pursued by different agencies.

To familiarize Federal facility engineers, managers, and planners with Federal requirements instituted by FEMIA, FEMP together with GSA have

developed trainin g courses on SES contracts and

life-cycle cost methods. In addition to FEMP

courses, there are several private-sector and individual agency training courses on a wide range of

energy management topics, as discussed in box 2-A.

Only a small fraction of the 5000 major Federal

facilities have sent personnel to FEMP’s training

courses. For example, through June 1990, 169

Federal employees attended one of the eight SES

training courses offered.21 In 1990, between 25 and

50 Federal employees, down from previous years,22

took FEMP’s combined life-cycle cost/a simplified

energy analysis method (ASEAM) course. These

courses could have an impact nonetheless. For

example, if even 3 percent of the 169 Federal

employees trained in SES in 1989 successfully

implemented a SES, the number of SES contracts

completed through 1990 would more than double.

DOE’s life-cycle cost training course is intended

to ease the transition from making decisions based

on traditional least first cost to least life-cycle cost.

It describes techniques for selecting the most costeffective building energy projects. The course includes instruction on a computer simulation program which helps managers estimate energy savings

and perform life-cycle cost analyses. The computer

program, called ASEAM-2, is available to all

Federal facility engineers and associated facility

managers to analyze building energy requirements.

Energy analysis and life-cycle cost analysis is

naturally complex, and some agencies still report

that it remains too complex for use. For example,

IW.s. Deptiment of Energy, Office of Conservation and Renewable EnerW, ‘‘Annual Operating Plan of Federal Energy Mamgement Program,’

December 1989, p. 4.

mpacific Nofiwest ~borato~, Architect’s and Engineer’s Guide to Energy Conservation in Em”sting Buildings, DOE/RL/0183P-H4, VO1. 1 and 2,

April 1990.

ZITCXJ COllinS, Feder~ Energy Mmgement Program, U.S. Department of Energy, personal communication, November 1990.

zzDean Devine, F~er~ Energy Management Program, U.S. Department of Energy, personal Commuticatio% J~. 17, 1990.

292-861 91 - 2
Box 2-A—Energy Training Courses

Training is a necessary ingredient in a successful energy management program in the government. Energy

managers must make decisions that involve rapidly changing technology, limited budgets, vacillating energy costs,

and the occupant in the facility. To aid Federal energy managers, many trainm“ g courses are available, both private

and government-offered.

The courses address a broad scope, ranging thin the particulars of boilers to lighting retrofit options to the

applicability of economic analyses. Since 1989 the Federal Energy Management Program and the General Services

Administration have offered two courses, Shared Energy Savings Contracts and Life-Cycle Cost Methods/A

Simplified Energy Analysis Method, to facility engineers, managers, and planners. Courses are also offered by

pmfessiomd societies, like the American Society of Heating, Refrigeration, and Air Conditioning Engineers and the

Association of Energy Engineers, by universities such as the University of Wisconsin at Madison and Virginia

Polytechnic Institute, and by manufacturers (e.g., General Electric’s Lighting Institute).

The private sector courses defiie a number of objectives: cutting costs, improving efficiency, and dispersing

knowledge concerning relevant technology. Most are seminars in which a variety of applications are discussed.

Many provide hands-on training and identi~ solutions to foreseeable obstacles. For example, Virginia Polytechnic

Institute offers an Energy Management Diploma Program that is completed in four courses. The institute states that

their objective in offering the program, now in its llth year, is to “get the participants into the energy management

mainstream so that they know where the resources are that can help them. ”1

In 1989,169 Federal employees, including 60 military personnel, attended one of the eight offered SES training

courses. ASHRAE reported that 15 of the 339 applicants for its fall 1990 courses were Federal ernployees.2

GSA/FEMP courses cost about $200, while private sector courses are $435 to $850 at the government rate. The

benefits of well selected training should produce greater savings than the cost of sending the employee.

l~~er ad ~nclosms from WMb A. whb~~ Associate Professor, Virginia Polytechnic ktitUte, Nov. 27, 1990,

2M~eW HW, ~fican Smiev of Hea~g,Refige~~g, and Air Conditioning Engineers, F= 011 Fedeti c~FIOYee p@@a@n

in fall 1990 AS HRAE Professional Development Seminars, Nov. 6, 1990.

when ASEAM was first introduced in FEMP courses FEMP is currently working with GSA and Potomac

in 1988, many found the computer program (which Electric Power Co. (PEPCO) to promote a relighting

required 16 floppy disks) daunting.23 The FEMP initiative. This initiative has three main benefits: 1)

life-cycle cost course including ASEAM is complet- providing a clear demonstration of new, energying its second year, and feedback from the first efficient but commercially available lighting techstudents should aid future participants. nologies as an example for other facilities; 2)

FEMP sponsors four mobile energy laboratories demonstrating use of a utility rebate program

(MELs) which can perform detailed measurement (PEPCO is adding $10 million to GSA’s $10-million

and analysis of facility energy use. The MELs are effort; and 3) implementing a highly cost-effective,

converted passenger buses containing sophisticated energy-saving measure.

energy monitoring, auditing, and analysis equipment, as well as a mobile work space for engineers Hosting Interagency Policy Meetings—FEMP

and technicians. Currently, the Army, Air Force,

Navy, and DOE each are assigned one of the

regularly hosts the meetings of two interagency

MELs.24 committees, one oriented to policy development and

the other oriented to policy implementation. The

Finally, FEMP provides individual assistance to focus of the recent meetings of these two committees

agencies and facilities when requested in developing has been development of a new Executive Order on

and implementing new programs. For example, Federal energy management (see above).

— —

z~TFeVOF L, NeVe and Robert W. salthouse, LJ@stics Management InStitute, ‘‘Making Shared Energy Savings Work” Report AL703R1, July 1988,

p. 3-7.

~paciflc Nofiwest Laborato~, kfobiie Energy ~aboraro~ use Pfan (Washington, DC: U.S. Department of Energy, April 1989).
Chapter 2-Policies and Programs for Federal Energy Efficiency . 27

As required by law, the 656 Committee has convened annually the past 3 years. However according

to the minutes of the committee meetings, no senior

agency personnel have attended, with the exception

of DOE’s Assistant Secretary of Conservation and

Renewable Energy .25 Instead, the designated members have sent representatives.

The second committee hosted by FEMP is the

Interagency Management Task Force, created by

FEMIA in 1988. This committee is composed of the

energy chiefs of all Federal agencies. It meets

periodically to assist the 656 Committee in coordinating promotion of energy conservation activities

within the Federal Government. This committee is

responsible for assessment of agency progress in

achieving energy savings, collection and dissemination of information relevant to energy savings,

coordination of energy surveys conducted by the

agencies, development of options for use in conserving energy, and reporting to the 656 Committee on

its findings.26 Since its inception the task force has

met three times beginning in June 1990. Generally,

the members of the task force are the same personnel

who have substituted at the 656 meetings in the past

2 years.

Federal Energy Efficiency Awards-Each year,

FEMP awards certificates of achievement to about

15 individuals and 15 facilities who have demonstrated exemplary performance in promoting conservation in Federal facilities. These awards include no

financial reward, but rather provide recognition and

favorable publicity for exemplary performance.

Life-Cycle Costing for Procurement

The Federal Government procures a great variety

of energy-related goods and services, and procurement policies are correspondingly diverse. For

example, procurement policy determines how gas

and electric utility service is obtained; whether and

how facilities use private contractors to perform

heating, ventilation, and air conditioning system

operation and maintenance; and which commonly

used items (such as lamps and refrigerators) are

available through the Federal Supply System.

Consideration of life-cycle cost is often required

for Federal procurement (see box 2-B). Implementation of that requirement varies depending on the

good or service being procured. Life-cycle cost

analyses are generally left to individual agencies or

facility managers to perform, but in some cases they

are given explicit guidance.

Two Federal agencies take the lead in procuring

the most commonly required products for the entire

Federal Government, including energy-consuming

or energy-conserving items such as lamps, household appliances, and office equipment. The Department of Defense’s (DOD) Defense Logistics Agency

is responsible for supplying lamps and associated

equipment to all Federal agencies. GSA’s Federal

Supply Service is responsible for other common

products and services. Of the thousands of products

available from these two agencies, a few have been

chosen based on their life-cycle cost, including

household products such as refrigerators, water

heaters, and room air conditioners listed on GSA’s

Household Appliances Schedule. For most other

energy-using products such as lamps, agencies

purchasing from the Defense Logistics Agency and

the Federal Supply Service are given little or no

guidance as to life-cycle cost.27 GSA selects office

products such as copiers and typewriters based on

life-cycle cost, too, but energy costs are not considered since they are small compared to factors such as

equipment durability and other operating costs (e.g.,

toner for copiers and ribbons for typewriters) .28

Shared Energy Savings

Under COBRA, all Federal agencies are allowed

to seek private sector financing and implementation

of energy efficiency projects. The SES program

permits Federal facilities to enter into contracts of up

to 25 years with private energy service companies.

Under SES contracts, private companies may perform energy services using their own capital and

personnel for energy efficiency improvements including energy audits, purchase and installation of

new equipment, operation and maintenance of

equipment, and personnel training. In exchange, the

contractors receive a specified portion of the cost

XU.S. Depmrnent of Energy, 656 Committee Meeting Minutes, Feb. 29, 1988, D=. 22, 1989, Oct. 10, 1990.

~42 U.S.C. 8257 (1990, Cumulative Annual Pocket Part).

ZTU.S. Dep~mentof Energy, Feder~Energy -gementprogr~ “Annual Report to Congress on Federal Energy ConservationPrograms, 1987,”

September 1988, p. 2.

zs~e Smiti Fedeml supply system General semices Administration, personal commdcatio% J~. 29, 1991.
28 ● Energy Efficiency in the Federal Government: Government by Good Example?

Box 2-B—Life-Cycle Cost Analysis

The Emxgy Policy and Conservation Act (EPCA), passed in 1975, directed the President to develop

procurement policies with respect to energy conservation opportunities.1 NECPA of 19’?8 went further, specifying

that agencies must consider life-cycle costing in procurement decisions. This requirement has been incorporated

in Office of Management and Budget guidelines for general procurement including the full range of goods and

services.2 In addition, the Office of Federal Procurement Policy has developed standards for energy conservation

which have been incorporated into the Federal Acquisition Regulations.

Use of life-cycle cost methodology by Federal agencies was introduced by Executive Order 12003 in 1977,

codified by NECPA in 1978 and amended by FEMIA 10 years later. The life-cycle cost method assesses energy

costs and savings potential over the total lifetime of a building or project to allow agencies to prioritize conservation

projects and provide funding to those with the highest life-cycle cost savings: investment ratio (SIR). The method

was designed by the Department of Energy as a way to estimate and compare different energy-use systems and

evaluate new building designs and retrofit actions, not just for initial costs, but for total costs over the estimated

lifetime of the project, system, or building. The National Bureau of Standards defines the method as follows:

A method of economic evaluation that sums discounted dollar costs of initial investment (less salvage value),

replacements, operations (including energy usage), and maintenance and repair of a building or building system over the

study period.3

under the Federal Energy Initiative (FEI) as established by NECPA, Federal agencies were required to retrofit

all buildings larger than 1,000 square feet with cost-effective measures by 1990. That requirement was dropped from

the FE1 by the Federal Energy Management Improvement Act of 1988. Currently, the life-cycle cost rule principally

applies to alternative building systems and designs for either existing or new federally owned and leased facilities,

solar energy projects, Federal photovoltaic projects and purchase of household appliances. Life-cycle cost must be

considered when choosing between alternate retrofit options, new building design, new building systems, and in

the selection of leased buildings. ,

142 us. code 6361 (1990, ~-~~ti”~ ~~p~ket p~rf).

%Xfice of Management and Budge4 Office of Federal Procurement Policy, “Federal Procurement Policy Concerning Energy

Conservation” Policy ktter 76-1, August 1976; and “Performance of Commercial Activities,” Circular A-76, August 1983.

3Ros~e T. Ruegg, U.S. Department of Commerce, National B~au of S~~dS> ‘‘Life Cycle Costing Manual for the Federal Energy

Management l?rogr~” NBS Handbook 135, 1987, p. xx.

savings. This system provides Federal agencies an There have been far fewer SES contracts than

alternative source of funding for energy efficiency originally expected. For example, the Congressional

investments during a time of great fiscal constraints. Budget Office projected that 30 SES contracts

See box 2-C for examples of Federal SES contracts. would be in effect in fiscal year 1988, saving the

Federal Government $250 million over a 5-year

SES contracts are not without shortcomings. period, fiscal years 1989 -93.3OThe conference report

According to one DOE contractor report, direct on the legislation enabling SES contracts estimated

Federal Government financing of a project results in 30 contracts averaging a savings of $0.5 million

savings 30 to 70 percent higher than the savings each. However, as of 1990 only four energy savings

from a SES contract.29 This is a natural outcome of contracts have been awarded. Some SES requests for

sharing the savings with the contractor. In addition, proposals (RFPs) issued by Federal agencies have

SES requires considerable effort from contract been entirely unsuccessful, receiving no responses.

specialists. Still, SES does allow energy efficiency For example, the Department of Veteran’s Affairs

investment when direct Federal financing is unavail- received no responses to its 1986 RFP concerning

able. the Medical Center at Perry Point, Maryland.

— - - ——.

‘9DHR inc., “Analysis of Shared Savings vs Direct Financing of Energy Retrofits in Federal Buildings, ’ DOE/CS/10097-1, May 1984.

.30US. Con=ess, Congressional Budget office, ‘‘C(~sI Estimate for 11 R 4W)5, the Federal Energy Miinagemen[ Improvement Act,’. May 26, 1988,

p. 4.
Chapter 2--Policies and Programs for Federal Energy Efficiency . 29

Box 2-C—Examples of Efforts To Implement Federal Shared Energy Savings Contracts

Federal agencies have been authorized by Congress to use shared energy saving (SES) contracts since 1986.1

By December 1990, five contracts had been signed, but one was terminated shortly thereafter. A larger number of

SES contracts have been considered, but not brought to fruition. At the end of 1990, there were 16 proposals under

development and 4 contracts under negotiation.

Because every Federal facility has a unique location, use, building style, and equipment, every SES contract

is unique. The two successful examples (only one of which resulted in an SES contract) here illustrate some of the

many issues which determine the success or failure of any SES project.2

Corpus Christi Army Depot: On September 7,1988, the Army signed an SES contract for the Corpus Christi

Army Depot. This project, which took over one and a half years to sign, illustrates the benefits of patience and

flexibility.

The Army wanted to retrofit a chiller and upgrade electrical service in an aircraft hanger. The Request for

Proposal (RFP) for the project was issued in early 1987, and a preproposal conference was held with potential

contractors, The winning contractor was to provide all the materials, equipment, and labor to remove the outdated

chiller and replace it with a modified system. hrari~g all rm~~ of the operation for the 25-year period specified in

the contract. For the first 6 months after the RFP was issued, the Army could find no interested prospective

contractors.

Based on cormnents from a potential contractor, the Army altered the contract to include additional

conservation measures to the chilled water system which would generate further savings and revised the shared

savings formula. These changes were crucial to making the project worthwhile for the contractor, as well as

increasing total savings. After over a year of negotiations, the contract was signed with Way Engineering Co., Inc.

Under the contract, Way Engineering Co., Inc. will receive 68.6 percent of the energy cost savings. The chiller is

now in operation and based on current usage rates, the contractor will recei}.e $7.6 million and the government will

save $3.5 million over the next 25 years.

Housing and llrban Development Headquarters: In 1987, the Department of Housing and Urban

Development (HUD) proposed using an SES contract in HUD’S Washington, DC headquarters building to install

energy efficient lighting and heating, ventilation, and air conditioning equipment. The RFP required that all

installation work on the project be done after normal office hours, which some potential bidders considered

restrictive. The contractor was to provide 7-year maintenance service.

After HUD secured a bidder and started negotiations, GSA announced that it planned to install an automatic

sprinkler system for fire safety. The sprinklers altered the economics of the SES project to such an extent that the

project was terminated. The relighting is now being performed by GSA directly concurrent with the sprinkler

insta.llation.s Although the SES contract was terminated, the project objective of improving energy efficiency will

be met, with all the savings accruing to the Federal Government.

l~Ornpr&~ns&c Om.n.ibUS Budget Reconciliation Act of 1985 (COBRA), Public Law 99-272, Title VfL 7201(a).

2U~ess otherwise noted, these descriptions are derived from: U.S. Department of Energy, “Shared Energy Savings Contracting for

Federal Agencies, lbpic D Exhibits,” DOE/CE-237, May 1990, pp. 4-6. For a description of the successful SES contract at the San Diego

Division of USPS, see ch. 5.

3Dep~ent of Housing and Urban Development “Energy Conservation Plan for Department of Houskg and Urb~ BvelQpment

Headquarters,” Oct. 1, 1990, p. 7.

Three factors help explain the lack of SES the complicated structure of SES contracts, which

contracts through 1989, as noted by the General differ from conventional contracts. Provisions for

Accounting Office.31 First, until 1989, Federal estimating energy savings, design of payment provifacilities were not allowed to retain any of the sions tied to energy savings and future energy prices,

savings, and agency officials lacked incentives for and the slower payback for contractors are examples

pursuing SES contracts. A second impediment was of how S ES contracts differ from conventional

—— —.—— ——-—. —

~lFOr a detai]ed discussion of three of these reasons, see U.S COn@Ws, ~JCnCd AU*I )Unting office. ‘ ‘Report to the CongrcssionaJ Requesters on

Federal Shared Energy Savings Contracting, ’ GAO/RCE[)-89-W, April 1989$ p 1
30 ● Energy Efficiency in the Federal Government: Government by Good Example?

contracts. Coupled with a lack of detailed baseline

energy-use data, developing energy and cost-saving

estimates present an obstacle. Finally, uncertainty

about procurement policy hampered SES efforts. For

example, OMB Circular A-76 requires that agencies

compare contractor cost to in-house cost for the

particular service, but such comparisons are difficult

to produce. Some agencies prepared voluminous and

detailed RFPs to ensure compliance with procurement policies. However, contractors prefer flexible

and limited RFPs because they cost less to respond

to and afford opportunities to explore a wider range

of energy-savings options in the facility.

GAO’s report noted that the impediments it

identified in 1989 were being addressed. For example, Congress added some incentives in the Federal

Energy Management Improvement Act of 1988 and

the National Defense Authorization Acts for fiscal

years 1989-91, as described above. Lack of baseline

energy-use data was partially addressed through

development of ASEAM, although calibrating the

model remains difficult. Increased familiarity with

SES contracts should result in a more flexible

interpretation of procurement policy. However,

other impediments remain, such as a reluctance of

agency officials to relinquish potential savings to a

private firm and a shortage of staff to identify and

implement projects. Whether the new incentives and

other changes are sufficient to promote more SES

activity in the future remains an open question.

Utility Rebate Programs

In the past year, FEMP has encouraged all Federal

agencies to make use of utility rebate programs for

energy efficient equipment.32 A large and growing

number of the Nation’s electric utilities and a few

gas utilities offer such programs as part of their

efforts to manage future demand. Many utility

programs are well-funded and comprehensive.33

Utility programs may also supplement facility staffs

by providing engineering and other expertise. For

example, Pacific Northwest Laboratory is working

for FEMP with Niagara-Mohawk Power Corp., a

New York utility, to develop a model program for

Federal facilities. Program goals include having the

utility provide 100 percent of the financing and also

provide contractors to perform audits and implementation. 34 Also, as noted above, PEPCO, the electric

utility serving Washington, DC, is working with

DOE and GSA to cofund a multimillion dollar

relighting project in Federal buildings.

Where available, utility rebate programs can be a

useful supplement to Federal funds and staff. Not all

utilities have programs, but for those that do, there

is a wide range of programs reflecting the capacity

and energy needs of the utility. Some utilities,

recognizing the special budgetary, procurement, and

other needs of governments, have created special

marketing arms to work with them. For example,

San Diego Gas and Electric Co. has an office solely

for Federal, State, and local governments which

helps them take advantage of rebates and engineering assistance offered by the utility to promote

energy efficient technologies.35

Energy Performance Standards for

New Federal Buildings

Under NECPA, all new Federal buildings are

required to meet energy performance standards

developed by DOE. The standard adopted for

Federal buildings is similar to Standard 90-1-P

developed by the American Society of Heating,

Refrigerating, and Air-Conditioning Engineers

(ASHRAE) and the Illumination Engineering Society. 36 The standard includes principles of building

design for insulation and window design for building envelope, lighting, hot water, electric power

distribution, HVAC system, and energy management.

32’r’here ~d bWn ~me ~ce~~ab~Ut whether Feder~ proc~~ent policies wow facilities to a~ept utility rebates. ThZit WeStiOn WaS reSOIVd

for the General Services AWstration by Public Law 101-509 Section 15, Nov. 5, 1990, and for the Department of Defense by the National Defense

Authorization Act for Fiscal Year 1991, as discussed above. Those laws explicitly allow GSA and DOD to accept utility rebates.

33A forthcoming OTA report, “Prospects for Demand Management in Electric and Gas Utilities,” is examining this type of program in detail.

~J.W. Ctie, Pacflc Northwest Laboratory, personal communicatio~ Fe- 1991.

35J.F. Drummer, Governmental Marketing & Services Manager, SDG&E, personal communicatio~ Sept. 28, 1990. See United States Postal Service

Case Study inch. 5, which describes lighting rebates SDG&E granted to the San Diego Postal Division.

36UQS. Dep~ment of Ener~, F~~~ Ene~ M~gement ~o~q F@ra/ Energy Mamgemnf Acn”vifies, ‘‘Federal Btild@ Enmgy

Conservation Standards,” summer/fall 1990, pp. 21-22.
Chapter 2-Policies and Programs for Federal Energy Efficiency ● 31

Energy in a whole new light.

4m3m Side quweo )sytha Califmrlh Eullic %li%a ~iem %’X2?2K%%*’%XW will Mlp

ratrofit law affidmq 48 f l

~ial ~

Wraawmt ligl.cing fixturaa with new:

- margy affioient 4~ fauaemm ~ -*

- 3Ltgll affioimoy alectmaio d I&tcid Ixma6t6,

- CfJtice.t Ieflssss, Ulx!

- _ -h 4“ ligbtiq fixtures.

w - ma mwm Ww

A W L@htiq Rkq@wentative will caamot a light* survey of yaw

f60ility. A &i@tiw aquiwwI t imtallatiwl Wntxeotca’ aalaotd by SM4E will

retrofit ~ iight~ Sfs$m ta ha4 ym eava mrq a li@lt* meta.

W&3 maa TM Pr03ram S$arv&‘ 1

Sm4E ~ial U=tco@m with morage monthly eleotric peek 10a& - 100 Mf

(for ewQM, A ml Offka building).

what Kia3e of Inrentivw Dc.a9 SEG&E Offer CMSta!!s@/

6EGrlE will prwida rash i31r4m tivw for the retrofit of lamps, b6Uaste and

4al.4uqpJ of 631isti13g fixtw?aa - wifi~ * our Lightirq ~tatiw. ‘3M?le inc6mtivaa will Vexy. cwendimtl * WStmwr light* hrws, qpe of

equqamlt awl Oparatim%

Wh? SiKR@4 I Cml~ fQ rl#are Inforloatio~

ksi~ acmunt cuatc6wr9 sbauld c0nt6ct their axw, xsign6d kceum

E6emtiVa. All othar eustmwrs slxnlld mntact Paul &erIlau9, Fie14 ~

of the @Y3&E Li@tiq C@!ter, at 549-6S34.

SDG&E

Retrofit Lighting Program

Investment Analysis

Company Name: U.S. Postal Service

Address: 3974 Sorrento Valley Blvd.

Job Number: 152

Retrofit savings (kWh)

Lighting kWh-before . . . . . . . . . ● . . 70,884

Lighting kWh-after . . . . . . . . . . . . . 24,984

kWhr savings . . . . . . . . . . . . . . . . . . 45,900

Percent reduction . . . . . . . . . . . . . . . 65%

Retrofit savings (dollars)

kWh savings . . . . . . . . . . . . . . . . . . . . 45,900

cost/kwh . . . . . . . . . . . . . . . . . . . . . . $0.100

Lighting savings . . . . . . . . . . . . . . . . . $4,590

Reduce A/C savings . . . . . . . . . . . . . $ 689

Reduced maintenance . . . . . . . . . . . $ 333

Total savings . . . . . . . . . . . . . . . $5,612

cost

Retrofit cost ( )estimate (X)final $6,855

SDQ&E incentive. . . . . . . . . . . . . . . . $5,331

Customer O@.. . . . . . . . . . . . . $1,524

Investment analysls

Savings- years . . . . . . . . . . . . . . . $16,835

Annual return on investment . . . . . . 368%

Payback period . . . . . . . . . . . . . . . . . 0.27

Additional benefits

. Hedge against future rate increases--possible increased future

savings

. Brand new lighting system-reduced future maintenance cost

. More pleasing light-!ess lighting glare

● Additional profits for your business-or keeping your business

more competitive

. increases marketabiiity of building

SDG&E’s lighting rebate program announcernent and an analysis performed for the U.S. Postal Service. Note that in this example,

SDG&E is contributing over 75 percent of project costs, resulting in a very high return on investment for USPS.

Energy Audits and Surveys of Existing

Federal Buildings

In the 1970s, both Section 381 (a)(2) of EPCA and

Section 547 of NECPA, as well as Order 12003,

mandated that Federal agencies conduct audits of

buildings larger than 5,000 square feet. Again in

1988, FEMIA directed DOE to conduct energy

surveys of a sample of facilities throughout the

government. Such audits form the basis for selecting

retrofit measures that improve overall energy efficiency and minimize life-cycle cost, and for determining the potential for governmentwide energy and

cost savings. However, results from the early energy

audits were not compiled to assess total government

potential, and there is no consolidated record of the

extent to which the retrofits identified were implemented. Currently, some surveys are being conducted at Federal facilities, although those results

have also not been coordinated to assess total

government potential.

Key Agencies’ Energy Management Plans

Primary responsibility for energy management

lies with each Federal agency for its own facilities

and operations. Under FEMIA, each major agency is

required to develop and implement its own energy

management plan to reduce building energy use per

square foot by 10 percent by 1995. The following

descriptions for the largest energy-using agencies

demonstrate the diversity of approaches taken,

reflecting the wide range of their missions and

perceived opportunities. Also, the agencies’ performance in meeting the 20 percent reduction goal
32 ● Energy Efficiency in the Federal Government: Government by Good Example?

Figure 2-l—Percent Change in Building Energy Use

per Square Foot, Fiscal Years 1975-85 and 1985-89

Percent

20 ]

DOD DOE USPS VA GSA

Agency

= 1975-85, Source = 1985-89, Source

m 1985-89, Site

SOURCE: U.S. Department of Energy, “Annual Report on Federal Government Energy Management Fiscal Year 1985,” DOE/CE-0171,

August 1986, table 2, p. 6; and U.S. Department of Energy,

“Annual Report to Congress on Federal Government Energy

Management and Conservation Programs Fiscal Year 1989,”

Oct. 3, 1990, table 3, p. 15; and table F, p. 78.

for 1975-8537 set forth in Order 12003 and performance between 1985 and 198938 

are s ummarized (see

figure 2-l). Note, annual reports have historically

emphasized energy used at the source rather than

energy used at the site as the most accurate measure

(see footnote 13). However, in 1990, the 656

Committee and the Interagency Energy Management Task Force agreed to emphasize energy use at

the site rather than at the source,39 and presumably

that will be the measure used to judge compliance

with FEMIA’s requirement of 10 percent savings

between 1985 and 1995 although that is not certain.

Accordingly, changes in energy between 1975 and

1985 are shown based on source accounting, and

between 1985 and 1989 are shown based on both

source and site accounting.

Department of Defense—Between 1975 and

1985, DOD reduced energy consumption per square

foot in buildings by 18.1 percent, more than the

average reduction accomplished by Federal agencies. Between 1985 and 1989, building energy use

per square foot increased 1.4 percent using source

accounting and declined by 5.4 percent using site

accounting.

In 1986, DOD established a second 10-year plan

to reduce energy consumption in buildings. 40 Under

DOD’s overall policy guidance, each service (e.g.,

Army, Navy, and Air Force) creates its own energy

management plan with minimum interference. These

plans, in turn, can be very detailed and comprehensive. 41 The overall DOD plan sets the services’ . minimum reduction goal, and assigns lead responsibilities with respect to research and development for

energy conservation and conversion technologies to

the three services. The assignment of lead service

responsibilities, which helps reduce duplication of

effort, has been given to the service with the most

expertise in the relevant technology. For example,

the Army is responsible for computer programs to

determine building energy characteristics, energyconserving structures and construction technology,

advanced heating and air conditioning, and energy

storage and distribution systems for fixed facilities.

On March 13, 1991, the Deputy Secretary of

Defense set forth comprehensive new guidance for

facility energy management, and established a goal

of reducing energy use in all facilities by 20 percent

in the year 2000 compared to 1985. 42

Spending on energy conservation investments has

decreased from $136 million in fiscal year 1985 to

O in 1989. Reversing this trend, $10 million has been

appropriated for fiscal year 1991, with a target of $50

million annually beginning in 1993.

Department of Energy—DOE is the largest consumer of energy in the civilian sector. Between 1975

and 1985, DOE reduced its buildings energy use per

square foot by 17.5 percent. Between 1985 and

1989, DOE further reduced building energy use by

10.1 percent using source accounting, and by 17.7

37u.s. Department of Energy, ‘‘Annual Report on Federal Government Energy Management Fiscal Year 1985,’ DOEKE-0171, August 1986, table

2, p. 6.

38u.s. Department of Ener~, ‘‘Annual Report to Congress on Federal Government Energy Mamgement and Conservation Programs Fisea.1 Year

1989,” Oct. 3, 1990, table F, p. 78, and table 3, p. 15.

ssTiM Van Sickle, Federal Energy Management Program staff, personal COmIn@HtiOu Mar. 20, 1991.

‘W.S. Department of Defense, Office of the Assistant Secretary of Defense for Acquisition and Logistics, “Defense Energy Program Policy

Memorandum 86-3,” DEPPM 86-3, Apr. 16, 1986.

dtsee, forexmple, Reynolds, Sfi~& ~ls~ ‘‘Department of the Army Energy Resources Management Plan FY86-FY95, Department of the Army,

January 1987.

42D.J. A~ood, Depu~ Secretq of Defense, memorand~ to secre~es of tie rnili~ departmen~, ?vk. 13, 1991.
Chapter 2--Policies and Programs for Federal Energy Efficiency ● 33

Photo credit: Robin Roy

GSA’s Suitland Complex has successfully used occupancy

sensors to automatically turn off lights when not needed.

percent using site accounting, already beating the

1995 FEMIA goal.

In 1985, DOE established the Ten-Year In-house

Energy Management Plan43 with the goals of reducing energy consumption in buildings, metered processes, and vehicles and equipment by 10 percent by

1995 compared to fiscal year 1985. The plan consists

of 12 programs that train employees in energyrelated matters and alter procedures to include

conservation elements. An example of employee

training is within the central plant improvement

program, which consists of all activities to make

existing and new central heating and cooling plants

more energy efficient. In 1983, a formal boiler

operator training and tuneup program was established. The program consists of 4 days of classroom

and hands-on training on boiler tuneups, and the

identification of retrofit options. In fiscal year 1984,

a steam-trap program was added. In the fiscal year

1989 annual report on in-house energy management,

DOE stated that six training sessions were conducted and, assuming that all recommendations

were implemented, the anticipated annual savings

would be over $7 million.44

Several of the programs alter procedures to

incorporate energy conservation decisions. An Operator Contractor Clause requiring efficient energy

use has been added for DOE owned and leased

facilities. The utility contract improvement program

seeks to identify and promote integrated usage and

cost reduction initiatives including conservation,

load management, and generation techniques in

concert with existing utility rate structure in order to

meet total energy requirements at lowest possible

cost. The metering program seeks to establish usage

patterns to pinpoint conservation opportunities by

monitoring actual consumption. New DOE buildings, owned or leased, are required to have permanent metering for each type of energy consumed.

Department of Veterans Affairs (VA)--Between 1975 and 1985, VA reduced buildings energy

use per square foot by 10.4 percent. Between 1985

and 1989, use increased by 2.5 percent using source

accounting, and declined by 1.1 percent using site

accounting. VA delegates responsibility for energy

management to its 162 medical facilities. 45 Each is

required to create the 10-percent reduction plan for

its facility. The central office monitors energy

consumption quarterly and tracks facility progress

toward meeting its goal.

The U.S. Postal Service (USPS)—Between 1975

and 1985, USPS exceeded the 20 percent energy

reduction goal, reducing consumption by 28.8 percent per square foot. However postal energy use is

rising due to increased automation, increased mail

volume, budget constraints, the relaxation of federal

temperature settings, and the required increased

ventilation mandated in the proposed ASHRAE

standard regarding indoor air quality. Energy use per

square foot in USPS facilities rose 3.6 percent by

source accounting or by 0.3 percent using site

accounting between 1985 and 1989. Each of the five

postal regions has been assigned a target reduction

to be met using energy surveys, employee awareness

(including energy discussions at higher levels of

management and SES training), and improved

maintenance.

General Services Administration—Between 1975

and 1985, GSA reduced building energy use per

43u.s. Depmrnent of Energy, Office of Project and Facilities mMgem@ “FY1989 Annual Report on In-house Energy Management”

DOE/MA-0416P, July 1990.

441J.S. Department of Energy, Office of Project and Facilities Management, ‘‘FY 1989 Annual Report on In-House Energy Management,’ July 1990,

p. 34.

45Raj~der p. G~~, Ctief, Energy ~mgement Divisio~ Veterans AdmhkWitiOIL persoti ~mmlmimtioQ Sept. 6>1990.
34 ● Energy Efficiency in the Federal Government: Government by Good Example?

square foot by 10.4 percent.46 Between 1985 and

1989, building energy use per square foot increased

by either 11 percent or by 8.2 percent, using source

or site accounting.

In-house, GSA has a comprehensive master plan

to be implemented by each region. Created in 1990

by energy coordinators, the plan is entitled the 5

Point Energy Reduction Plan. 47 The five points are

planning and monitoring, identifying and implementing projects, improving operations, raising

energy awareness, and conserving energy in leased

space. Each point contains a series of activities to be

completed by a specific date and responsible office.

The administration has set aside $30 million in its

fiscal year 1991 budget to complete conservation

projects.

~neGener~ SeNice Administmtion’sperformancebeween 1975 and 1985 isagoodexample of the effect Of ming so~rathert.hansite acmm@?

in measuring building energy use. Measured according to site energy, GSA’s building emrgy use declined by 24.5 percent rather t.ban only 10.4 percent.

d7&ner~ Services Administration Real Property Management and stiety, “GSA 5 Point Energy Reduction Plaq” March 1990.
Chapter 3

Federal Spending on Energy

Used in Commercial and

Residential Buildings
Contents

Page

FEDERAL ENERGY USE IN COMMERCIAL BUILDINGS . . . . . . . . . . . . . . . . . . . . . . . . 37

Electricity Use . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

Natural Gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ● . . . . . . . . . . 39

Fuel Oil and Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39

FEDERAL SPENDING ON RESIDENTIAL ENERGY USE . . . . . . . . . . . . . . . . . . . . . . . . 39

Housing and Urban Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .40

Health and Human Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .41

Department of Defense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42

Main Energy Uses in Federally Owned or Assisted Housing . . . . . . . . . . . . . . . . . . . . . . . . 42

HOW MUCH CAN THE FEDERAL GOVERNMENT TRIM FROM ITS “

BUILDING ENERGY BUDGETS? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44

Federally Owned and Leased Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44

Federally Assisted Households . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .45

ENERGY- AND COST-SAVING MEASURES: ARE THEY TRULY WORKING

OPTIONS FOR THE FEDERAL GOVERNMENT? . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

There Are Many Effective Energy Efficiency Measures . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

New Technologies Do Not Always Work as Planned . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

Savings Estimates Often Differ From Actual Savings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

Applicability of Efficiency Measures Is Often Site-Specific . . . . . . . . . . . . . . . . . . . . . . . . 47

Successful Implementation Often Requires Ongoing Effort . . . . . . . . . . . . . . . . . . . . . . . . 47

EFFICIENT TECHNOLOGIES FOR MAJOR ENERGY USES ... +... . . . . . . . . . . . . . . .47

Lighting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

Heating, Ventilation, and Air Conditioning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51

Miscellaneous Energy Uses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .54

Box

Box Page

3-A. A New, Improved Exit Sign: What Difference Could It Make? . . . . . . . . . . . . . . . . . . . 55

Figures

Figure Page

3-1. Federal Facilities Energy Use . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39

3-2. HUD-Assisted Housing Participants and Subsidies, 1989 . . . . . . . . . . . . . . . . . . . . . . . . . 40

3-3. HHS-Assisted Housing Participants and Operating Subsidies, Fiscal Year 1989...41

3-4. Primary Heating Source, LIHEAP Households and All U.S. Households, 19$9....43

3-5. Military Family Housing, 1989 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .43

3-6. Residential Energy Use and Expenditures, 1987 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .43

Tables

Table Page

3-h Commercial Buildings in the United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

3-lb. Federal Buildings in the United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .38

3-2. Lighting Efficiency Measures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .48

3-3. Comparison of Fluorescent Lamps . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .50

3-4. HVAC-Related Efficiency Measures . . . . . . . . . . . . . . . . . . . . . . . . +... . . . . . . . . . . . . . . 52
Chapter 3

Federal Spending on Energy Used in

Commercial and Residential Buildings

The Federal Government owns and leases about

500,000 buildings of various sizes, construction, and

uses. In fiscal year 1989, the energy used in these

buildings cost the U.S. Treasury about $3.5 billion.

In addition, the Federal Government spends approximately $4 billion each year subsidizing the utility

bills of about 9 million lower income households

through various assistance programs. Much of the

electricity, natural gas, and petroleum purchased

with this combined $7.5 billion is inefficiently used.

Although the responsible Federal agencies have not

analyzed basic energy- and cost-saving opportunities in Federal facilities, apparently at least 25

percent of the energy could be saved using a wide

variety of currently available, cost-effective measures. Similar opportunities appear to exist in subsidized households.

FEDERAL ENERGY USE IN

COMMERCIAL BUILDINGS1

As of 19862 there were just over 4 million

commercial buildings with 57 billion square feet of

floor space in the United States. The main uses of

these buildings are highly varied, including offices,

retail shops, schools, and hospitals (see table 3-la).

The Federal Government owns over 51,000 of these

commercial buildings with between 1 and 2 billion

square feet of floor space,3 and has about 7 percent

additional floor space under lease.4 As in the private

sector, Federal building uses are diverse (see table

3-lb).

By far the largest Federal user of energy in

commercial buildings is the Department of Defense

(DOD), with about two-thirds of the total floor

space. This does not include DOD’s buildings in

foreign countries. DOD commercial buildings include the complete range of functions: offices, warehouses, hospitals, retail stores, cafeterias, churches,

etc. Figure 3-1 shows facilities energy use by the

main Federal energy-using departments.

Federal agencies own most of the commercial

building space they occupy. However, Federal

agencies also often lease space either from private

companies or from the General Services Administration (GSA), which owns and leases commercial

space on their behalf. Because GSA often manages

property for other agencies, it is the third largest

owner (after DOD and the U.S. Postal Service

(USPS)) of Federal buildings.

Enormous amounts of energy in several forms are

used just to make the buildings inhabitable, that is,

to provide light, heat, ventilation, and air conditioning. Large amounts of additional energy are used to

power the wide assortment of appliances and equipment used in the buildings, ranging from computers

to conveyor belts to stoves. In total, $61 billion in

electricity, natural gas, fuel oil, district heat, and

propane were consumed in 1986 to operate the

Nation’s commercial buildings.5 Federally owned

and occupied nonresidential buildings accounted for

over 6 percent of that total. 6

IDefin~ awor~g to the Energy ~o~tion Administration’s Nonresidential Buildings Energy Consumption Survey EM: “roofed and w~~

structures used predo minantly for a nonresidential, nomgricultural, and nonindustrial purposes and larger than 1000 square feet. ” U.S. Department of

Energy, Energy Information Administration Nonresidential Buildings Energy Consumption Survey: Characteristics of Commercial Buildings 1986,

DOE/EIA-0246 (Washingto~ DC: U.S. Government Printing Office, September 1988), p. 3.

z~e yew 1986 is the most rewnt for which data are available. However, each year approximately IOO,OOOnew commemi~ buildings ~e cons~ct~”

Ibid., p. 82.

s~id., @ble 25, p. 79 reP~ a~ut 1,1 bi~on s~~e feet in its ~~ey; U.S. Gener~ services A@s~tio~ “hvmtory Report of Real h~~

Owned by the United States Throughout the World,” p. 11, Sept. 30, 1989, reports about 1.9 billion square feet in the United States.

dFrom U.S. Gmm~ Semices Ams@tiou ‘‘~ventow Rqort on Red ~op@ ~~ed to the United Stites “f’hroughout the World, ” 1989. ‘f’kKlt

~port does not distinguish between residential and nonresidential uses, nor does it note building size.

SU.S. Energy Information khninktratio~ “Nonresidential Buildings Energy Consumption Survey: Commercial Buildings Consumption and

Expenditures 1986,” DOE/EIA 0318(86), table 1, May 1989, p. 4.

~otal spending on energy for all federally owned buildings was M billion in fiscal year 1987, according to U.S. Department of Energy, Assistant

Secretary, Conservation and Renewable Energy, “Annual Report on Federal Government Energy Management Fiscal Year 1987.” Around $200miLIion

of that was in military family housing. An additional amount was spent on energy used in leased buildings for which the Federal Government does not

pay utilities directly.

–37–
38 ● Energy Efficiency in the Federal Government: Government by Good Example?

Table 3-la—Commercial Buildings

in the United States

All buildings

Number of Total floor space

Building activity buildings (1,000) (million sq. ft.)

Assembly . . . . . . . . . . . . . . . .

Education . . . . . . . . . . . . . . . .

Food sales . . . . . . . . . . . . . . .

Food service . . . . . . . . . . . . . .

Health care . . . . . . . . . . . . . . .

Lodging . . . . . . . . . . . . . . . . .

Mercantile/service . . . . . . . . .

Office . . . . . . . . . . . . . . . . . . . .

Public safety . . . . . . . . . . . . . .

Warehouse. . . . . . . . . . . . . . .

Other . . . . . . . . . . . . . . . . . . . .

Total . . . . . . . . . . . . . . . . . .

571

240

102

201

51

137

1,273

607

50

487

94

3,813

7,287

7,200

712

1,277

2,104

2,785

12,710

9,499

665

8,540

3,730

56,508

SOURCE: U.S. Department of Energy, Energy lnformation Administration,

“Commercial Buildings Consumption and Expenditures 1986,"

DOE/EIA-0318(86), May 1989, p. 9.

Table 3-1 b—Federal Buildings in the United States

Total floor space

(million sq. ft.)

Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 431

Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 510

Research and development . . . . . . . . . . . . . 124

Industrial . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123

Hospitals . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131

Storage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 462

Schools . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 122

Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103

Housing . . . . . . . . . . . . . . . . . . . . . . . . . . . . 705

SOURCE: U.S. General Services Administration, “Summary Report of

Real Property Owned by the United States Throughout the

World as of September 30, 1988," GSA Public Buildings

Service.

Electricity Use

Electricity is the dominant energy form used in

commercial buildings in terms of total annual

spending($47billionin1986,$2 b

Federa1). 7

Electricityisessentialforpoweringlights,

electronic equipment, and the wide array of motors

found in everything from elevators to conveyor belts

to heating, ventilating, and air-conditioning (HVAC)

equipment, and is also used for heating and cooking.

It is also the most expensive per unit of energy

delivered to the Federal Government (at $17/million

Btu, electricity is four times more costly than natural

gas).

Precisely how is electricity used in Federal

commercial buildings? Although a large body of

information is available, the amount of electricity

actually used in any given building for any function

such as lighting or office equipment can be only

approximated since individual appliances or devices

are not individually metered. Buildings “typically

have a single meter tracking the total amount of

electricity being used by all devices. Some Federal

facilities such as military bases and other multibuilding complexes have even less information available.

These facilities may have only a few meters monitoring energy use for a facility with hundreds or

thousands of buildings. The lack of detailed information about energy use in Federal buildings is a

frequently cited impediment to the analyses and

programs needed to implement cost-saving efficiency measures.

Due to the wide variety of building uses, geographic and weather conditions, type and age of

construction, maintenance histories, and other factors, the amount of energy used in different buildings

is highly variable. As weather conditions change

from year to year, HVAC demand can change

significantly. This complicates efforts to identify

and monitor the performance of widely applicable

energy- and cost-saving measures. It also complicates efforts to set standards of performance, such as

maximum energy use per square foot, and to

compare buildings. Each building has unique energyuse patterns and cost-saving opportunities.

Despite the limitations on detailed or site-specif

information, there are some general estimates of the

relative consumption of different uses. Lighting and

air conditioning are the largest overall uses of

commercial building electricity, although estimates

vary. For example, one Electric Power Research

Institute (EPRI) study estimated that lighting and

cooling, respectively, consume 41 percent (since

revised to 34 percent) and 31 percent of commercial

building electricity. 8 As should be expected, the

study’s estimates varied greatly by building type; for

example, hotels were estimated to use only 23

percent of their electricity for lighting, with 43

percent used for cooling. Reflecting the uncertainty

inherent in determining detailed energy uses, other

VU.S. Ener~ Information Administration, op. Cit., fOOtnOte 5.

8Gmrg~ ~ti~te of Te~~~l~~, The Comti Planning s~~tem: National ad Regio~[ Data a& Analysis, EPRI EM-6 (pa10 AltO, CA:

Electric Power Research Institute, March 1986), p. B-37. Current best estimate of 34 pereent for lighting from letter from Clark Gellings, Electric Power

Research Institute, Feb. 15, 1991.
Chapter 3--Federal Spending on Energy Used in Commercial and Residential Buildings ● 39

500

400

300

200

100

0

Figure 3-l—Federal Facilities Energy Use

1985 1989

Fiscal year

Agency

m DOD = DOE m USPS

- V A = GS A m Other

NOTE: Site accounting used for electricity (see ch. 2).

SOURCE: U.S. Department of Energy, Federal Energy Management

Program, “Report on Federal Government Energy Management

and Conservation Programs,” October 1990.

studies have produced quite different estimates. For

example, a Gas Research Institute (GRI) study

estimated that only 26 percent of electricity used in

buildings is for lighting (11 percent in hotels), far

less than EPRI’s current estimate of 34 percent.9

However, both studies agree that lighting and

HVAC together account for over 70 percent of total

commercial building electricity use.

Natural Gas

Natural gas is the second most heavily used

energy source in the Nation’s commercial buildings.

It is the dominant energy source for space heating,

water heating, and cooking, and accounted for $8.4

billion in 1986.10 The Federal share of this spending

was around $0.5 billion. As in the case with

electricity, no one knows precisely how much

natural gas is consumed in different uses. However,

fewer devices use natural gas, so both metering and

estimating use are less complicated. GRI estimates

that space heating alone accounts for over two-thirds

of gas use in commercial buildings, with under 4

percent used for water heating. The remainder is

consumed in miscellaneous uses including cooking

and cooling.

Fuel Oil and Miscellaneous

Fuel oil is used in just 12 percent of commercial

buildings, mainly for space heating, with a total bill

of $2 billion. A disproportionately large share, 25

percent or 17.4 million barrels/year, of that total is

used in Federal facilities. The fuel oil is used almost

entirely for space heating.

Some of the Nation’s largest buildings use district

heat (e.g., steam or hot water generated in a central

plant and distributed to a number of buildings) for

space heating, water heating, and cooking, with a

total bill of $2.6 billion. There is also some use of

district cooling. Federal buildings use a disproportionately large amount of district heat relative to

other buildings. This is consistent with the high level

of oil use, and reflects the use of fuel oil to generate

steam for district heating systems. The remaining

energy forms (e.g., propane and wood) are far less

common and used mainly for space heating.

FEDERAL SPENDING ON

RESIDENTIAL ENERGY USE

As of 1989 there were over 90 million households

for about 240 million people in the United States.ll

The Federal Government subsidizes or pays part or

all of the utility bills in about 9 million of these

households. Two executive agencies are responsible

for the vast majority of Federal expenditures on

residential energy use: the Departments of Housing

and Urban Development (HUD) and Health and

Human Services (HHS). These two agencies subsidize or provide assistance payments for residential

utility bills for low-income Americans. In addition,

DOD houses 1.4 million military personnel and their

dependents in family housing, and a few other

agencies have a few thousand residences.

In total, $98 billion in electricity, natural gas, fuel

oil, district heat, and propane were consumed in the

Nation’s homes in 1987 to operate appliances and

gGas Resewh Institute, Baseline Projection Data Book (wSSbkl@OIL DC: 1989), P. 122.

IW.S. Dep~ent of Energy Information Administratio~ op. cit., footnote 5, table 2, p. 5-6.

ll~SPpU~tioneS~te d~snot in~lUde ~ehomeless and ~ple living in insti~tio~ (e.g., diw bmcb, @SOIIS). U.S. BWW3U Of the CSIXWS,

StatisticaZAMract of the United States: 1990, llOth ed. (Washington DC: 1990), pp. 2,45.
40 ● Energy Efficiency in the Federal Government: Government by Good Example?

Figure 3-2—HUD-Assisted Housing Participants and Subsidies, 1989

Participants

~ Millions 1

5

4

3

2

1

0

i

I

Public housing Sec. 8 Sec. 202

Program

IZZZl # of units m # of tenants

SOURCE: U.S. Department of Housing and Urban Development.

provide hot water, heating, and cooling.12 In 1989,

the Federal Government’s share of housing energy

costs was about $4 billion.

Housing and Urban Development

Each year, HUD spends from $2 to $3 billion

subsidizing the energy bills for 3.6 million federally

assisted housing units (see figure 3-2). 13 There are

two main HUD-assisted housing programs: a lowincome public housing program and the Section 814

rental housing assistance program which can be used

in privately owned housing.15 Both programs are

administered by HUD-regulated local public housing authorities (PHAs), of which there are about

2,700 nationwide.

Public Housing

Under the public housing program, local public

housing authorities and Indian housing authorities

develop, own, and manage housing projects. They

receive HUD subsidies for construction, rehabilitation, and operating costs. Currently, approximately

1.4 million housing units in nearly 10,000 individual

Subsidies

12 $ billions

10- —————V

8 -

6-

4 -

2-

0 1 1

Public housing Sec. 8 Sec. 202

Program

= Operating subsidy = Utility subsidy

~ Total Subsidy

projects are administered by 2,700 PHAs. In total,

about 3.8 million people live in public housing.

Energy expenditures constitute a large fraction of

HUD’s total spending on public housing. HUD’s

payment subsidy for utilities in these units for fiscal

year 1989 was over $900 million (most was for

energy, but this figure also includes water and

sewer). l6

Tenants of public housing typically pay 30

percent of their adjusted family income toward rent

plus utilities, with the remainder of costs paid for by

the housing authority (which is reimbursed by

HUD). HUD does not keep account of the total

annual spending on utilities including both HUD and

tenant copayments.

Section 8

HUD’s Section 8 low-income assistance program

subsidizes 2.3 million housing units. Unlike public

housing, Section 8 housing maybe privately owned.

Through the Section 8 program, HUD subsidizes

total housing costs, including both rent and utilities

lzne yew 1987 is the most recent for which detied data are available for residential energy use. However, each year over 1 million new households

are added to the existing stock. U.S. Department of Energy, Energy Information Agency, Household Energy Consumption and Expenditures 1987 Part

1: NationuZ Data, DOE/EL4 0321/1(87) (Washingto~ DC: U.S. Government Printing oftlce, October 1989), table ES1, p. viii.

13J.M. MacDonald et al., Existing Building Eficiency Research, 1987-1988, Oak Ridge National Laboratory, 0~/CON-268 (washingto~ DC:

U.S. Government Printing Office, August 1988), p. 25.

ldsection 8 from the United Sates Housing Act of 1937, as amended (42 U.S.C. 1437f) (1990, Cumulative AIUI~ pocket part).

]sFor a histon~ Ovemiew of ~-msisted-housing Progms, see Gmce ~lgr~ Library of Congress, Congressional Research Service, Housing

Policy: Low-and Moderate-Income, E388106 (Wmhingto~ DC: Congressional Research Service, Aug. 29, 1990).

16JOIIII Comerford, U.S. Dep@ment of Housing and Urban Development personal cO~Uni@iOQ Oct. 17, 19N.
Chapter 3-Federal Spending on Energy Used in Commercial and Residential Buildings . 41

Figure 3-3-HHS-Assisted Housing Participants and Operating Subsidies, Fiscal Year 1989

Participants Operating subsidy

Millions , * $ billions

16 , I I I

14 I

12

10

8 ]r, 6

4

2

0

1

0.8

0.6

0.4

0.2

0

Heating Cooling Crisis Weatherization Heating Cooling Crisis Weatherization

assistance assistance

Type of assistance Type of assistance

= # of households Z%ZZl # of occupants m $ LIHEAP subsidy

SOURCE: Number of occupants based on average household size in the United States. U.S. Department of Health and Human Services, Office of Energy

Assistance, “Low Income Home Energy Assistance Program Report to Congress for FY 1989,” October 1990.

for low-income, elderly, or handicapped tenants of

participating rental properties. HUD subsidizes the

difference between “fair market rent” (including

utility expenses) and 30 percent of tenant adjusted

income.

HUD does not keep track of energy use and

spending in Section 8-assisted housing. As a result,

less is known about the cost of energy in Section 8

housing compared to the public housing program.

However, based on the amount of energy spending

in public housing ($650/unit annually), a reasonable

estimate of annual Section 8 subsidies which are

used for energy is $1.5 billion. As with public

housing, this estimate does not include the amount

paid for by tenants.

Health and Human

HHS’ LOW Income Home

Program (LIHEAP)18 assists

Services 17

Energy Assistance

low-income households in meeting costs of residential heating or

cooling. Some LIHEAP recipients live in HUDassisted housing, but the majority do not. HHS

provides grants to the States and to Indian tribes and

territories which administer the program. In fiscal

year 1989, HHS spending on LIHEAP totaled $1.4

billion. States supplemented this amount with oil

overcharge funds ($174 million), LIHEAP carry--

overs from fiscal year 1988 ($82 million), and a

small amount of State funds ($6 million). In total,

around 15 million19 people in about 6 million

households were assisted with heating and cooling

subsidies (see figure 3-3). The 6 million households

receiving LIHEAP assistance represent only around

23 percent of those eligible under the Federal

maximum income standard. That is, over 25 million

households meet the Federal maximum income

standard for LIHEAP assistance. States often apply

more restrictive standards.

LIHEAP assistance covers some but not all of the

total cost of a recipient’s energy use for heating and

cooling. For example, approximately 50 percent of

a typical recipient’s heating costs are paid by

LIHEAP, with the remainder paid by the recipient or

other sources. Twenty-one percent or about 1.3

million LIHEAP households live in HUD-assisted

housing, so they receive energy subsidies or assistance from both HUD and HHS.

Until 1994, States are also allowed to divert 10

percent of LIHEAP funds to nonenergy block grants

such as social services, community services, and

17~s Se c tion iSbm~ ~nfi~rmati~n~on~ed inu.s. Dq~mentofHeal~ ~d Human Servims, Of-ficeof Energy Assistance, “LowIncomeHome

Energy Assistance Program Report to Congress for FY 1989,” October 1990.

18The ~w~(.omeHomeEnm~ ASSiStance~o-iS aU&ori~dby Tide ~ of tie Omnibus Budget Reconciliation Act of 1981 (OBRA), ~blic

Law 97-35, as amended.

l-s does not @ack the nm~r of ~ople ~sist~ by ~~.~s es~ate is based on av~age household size in the United StateS.
42 ● Energy Efficiency in the Federal Government: Government by Good Example?

alcohol, drug abuse, and mental health services. In

fiscal year 1989,28 States did so, most of them to the

maximum amount, reducing the total spending on

energy assistance.

The majority of LIHEAP recipients use natural

gas as their primary heating source, with fuel oil and

electricity far below. Compared to all U.S. households, LIHEAP recipients use far less electric

heating and more liquefied petroleum gas (LPG) and

kerosene (see figure 3-4).

Department of Defense

DOD houses over 1.4 million military personnel

and their dependents in 422,000 multifamily and

single family housing units worldwide (see figure

3-5). Most reside in the United States, but large

concentrations are in several other countries. The

U.S. Army, largest of the services, has just under half

the total housing units and just over half of the total

served population. In addition to family housing,

military barracks house a large number of troops

which are not included in these totals.

Generally, energy used in individual units is

neither separately metered nor charged for. Total

energy use in military housing is around 53 billion

MBtus annually. This energy cost the Federal

Government around $200 million based on the

average cost of energy.

Main Energy Uses in Federally Owned

or Assisted Housing20

As in the commercial sector, only a few main

energy uses constitute the majority of residential

energy consumption and spending (see figure 3-6).

By far the highest on the list both in terms of total

energy use and spending is space heating. Heating

energy use and expenditures vary greatly depending

on factors such as climate, type of building, size of

household, and condition. For example, an average

household in west coast States spends one-third as

much on heating as a New England household, and

an average single family household spends twice the

amount on heating as one in a large apartment

building. As an indication of increased energy

efficiency in construction over time, homes built

since 1980 use only two-thirds the energy of homes

built before 1950, after adjusting for weather and

home size. Natural gas supplies over two-thirds of

the energy used for space heating. Most of the rest

(20 percent) is provided by fuel oil and kerosene,

with the remainder split between electricity and LPG

(5 percent each).

Nearly every household has a water heater, which

on average consumes 18 MBtu/year, making that the

next largest residential energy use. As with space

heating, natural gas provides two-thirds of the

energy used in water heaters. Some large apartment

complexes (common among assisted housing projects and some military housing) may have a central

boiler providing water heating and/or space heating.

Refrigerators are the largest single use of residential electricity, consuming about 20 percent of the

total. Nearly every household has a refrigerator, and

on average, it consumes around 1,500 kWh/year. Air

conditioning is the second largest residential electricity use after refrigerators. Unlike refrigerator use,

energy use for air conditioning depends strongly on

household location and type. For example, only a

third of households in the relatively cool Northeast

even have air conditioning, compared to 80 percent

in the South.21 And those air conditioning units in

the South consume on average more than double the

amount used in units in the Northeast. Air conditioning depends strongly on income levels. Households

below the poverty line are a third less likely to have

air conditioning than the average household. A large

list of other uses constitute the remaining 16 percent

of household energy. These include cooking, dishwashers, clothes washing and drying, lighting, and

electronic equipment such as televisions.

As in the case with U.S. housing generally, energy

use in federally assisted and owned households is

diverse, reflecting the diverse nature of the building

stock and weather conditions across the country .22

There are many building styles in public housing

projects, ranging from high-rise apartments to lowrise apartments to groups of two- or three-story

duplexes. Large projects may have several hundred

units. Age and condition of public housing varies

widely, too. Many projects were constructed prior to

~ne tiormation in tbk+ s~tion is derived from, op. cit., footnote 12. The descriptions here are true of housing in general, although federally o~ed

or assisted households have some different attributes.

ZIU.S. Department of Energy, Energy ~ormation Administration, op. cit., footnote 12, tables 7, 32, ES1, October 1989.

zzseeper~s & Will and Ehrenkrantz Group, ‘‘AnEvaluationof tbe Physical Condition of Public Housing Stoelq Vol. 4,” HUD Report H2850, 1980.
Chapter 3--Federal Spending on Energy Used in Commercial and Residential Buildings ● 43

Figure 3-4—Primary Heating Source,

Natural gas 56%

LIHEAP Households and All U.S. Households, 1989

Natural gas 55%

her 7%

Electricity 1 10%

Other 7%

.PG 5%

rosene 2%

e Electricity y Kerosene 4 % Fuel oil 13% Fuel oil 12%

LIHEAP recipients All U.S. households

SOURCE: U.S. Department of Health and Human Services, Office of Energy Assistance, “LOW Income Home Energy

Assistance Program Report to Congress for FY 1989,” October 1990.

Figure 3-5—Military Family Housing, 1989

Number housed

Thousands

Residential energy consumption

Billion MBtus

800

600

400

200

0

25

20

15

10

5

0 —

Navy Air Force

Service

Army

of occupants

Navy Air Force Army

Service

= Residential use

NOTE: Source accounting used for electricity.

SOURCE: U.S. Department of Defense.

Figure 3-6—Residential Energy Use and Expenditures, 1987

Other appliances

\

1

16%

. Air conditioning

~ Refrigerators

7%

Water heating

Space heating

54% A Water heating

L 18%

Other appliances

30%

Energy use Energy expenditures

SOURCE: U.S. Department of Energy, Energy Information Administration, “’Household Energy Consumption 1987,”

DOE/EIA-0321/1(87) (Washington, DC: U.S. Government Printing Office, October 1989).
44 ● Energy Efficiency in the Federal Government: Government by Good Example?

the first oil-price shock in 1973, and were built with

accordingly low insulation levels. HHS-assisted and

military households have a similar broad range, with

the addition of single family houses. Even within a

given complex, units can have widely varying

energy use. For example, an end unit in an apartment

building, with more exposed walls and windows,

may require considerably more fuel for heating than

an interior unit. Similarly, the same unit with different occupancy levels can have different energy use.

HOW MUCH CAN THE FEDERAL

GOVERNMENT TRIM FROM ITS

BUILDING ENERGY BUDGETS?

Federally Owned and Leased Buildings

There is little question that a large fraction of

the Federal Government’s $3.5 billion direct

annual spending on energy in its buildings could

be greatly reduced using cost-effective, wellproven technologies. For example, at the five

federally owned or leased facilities in OTA’s

commercial case studies (see ‘‘Chapter 5: Case

Studies”), the facility managers estimated that an

average savings of at least 25 percent in annual

operating cost and energy use appears achievable

with proven and highly cost-effective technology.

This level of saving requires no change in occupant

comfort or productivity; rather, it involves more

effective use of energy, either through more efficient

equipment or through improved operations and

maintenance practices.

OTA’s case study estimates included only highly

cost-effective options in which the capital costs and

other costs of implementation are small compared to

the savings, with simple paybacks of under 3 years.

A less stringent economic test which is more

consistent with the cost of capital in the United

States would likely produce considerably higher

estimates. For example, the 3 year payback represents a long-term return on investment of about 30

percent, far higher than the average rate of return on

electric utility investments (about 14 percent in

1991) or the Treasury’s cost of funds (currently

under 8 percent).

Several recent analyses of the potential for energy

efficiency in commercial buildings in the United

States have estimated that gains of 25 percent or

more are technically and economically feasible. 23

While these analyses do not focus on Federal

facilities, they are indicative of the potential for

typical buildings. Whether Federal facilities offer

more or fewer opportunities for improvement is

speculative.

The Federal Energy Management Program

has not developed estimates either of the government’s potential energy and cost savings nor of

the capital and other resources required to attain

those savings. Similarly, none of the individual

energy-using Federal agencies contacted by OTA

have produced estimates for their own facilities.

All cite difficulties of performing the information

collection and analyses required for even approximate estimates. Although building audits mandated

under the Energy Conservation Policy Act were

conducted at most major facilities in the past decade,

there has been no Federal effort to compile the

results, much less to keep results current. The same

is true of the facility energy surveys mandated under

the Federal Energy Management Improvement Act

of 1988.

The lack of reasonably detailed, comprehensive

analytical effort to date should not be interpreted as

representing a lack of energy efficiency opportunities. Although Federal agencies have not published

overall estimates of prospects for efficiency gains,

they often take the public position that large gains

are possible.24 It is important to note that many easy,

low risk (or risk-free) energy- and cost-saving

measures with excellent economic characteristics

have yet to be implemented at Federal facilities.

The best options currently available appear to be

excellent ways to reduce costs, energy, and environmental impacts under virtually any set of reasonable

assumptions of future energy prices.

23 Forexwple, S* R.S. C~lSmiti et ~.~ “Energy Efficiency: How Far Can We 00?” ORNLJI’M- 11441, Oak Ridge National Laboratory, OakRidge,

TN, January 1990; and Barakat & Chamberliq Inc., ‘‘EfIlcient Electricity Use: Estimates of Mamm“ um Energy Savings,” EPRI CU-6746, Electric Power

Research Institute, March 1990; and COrmnittee on Alternative Energy Research and Development Strategies, National Research Council, Conjbnting

Climate Change: Strategiesfor Energy Research and Development, DOE/EH189027P-Hl (Washington, DC, August 1990), pp. 80-90.

~Fore~pIe, S=U.S. Dep~ent of Energy, Federal Energy Management Program, “titiWmtmRxkr~ @Ver~ent~WY~mWnent

and Conservation programs Fiscal Year 1989, ’ Oct. 3, 1990, p. 26-41; and Executive Order 12759, signed Apr. 17, 1991, which includes a provision

for a 20-percent reduction in both buildings and industrial facilities by 2000.
Chapter 3--Federal Spending on Energy Used in Commercial and Residential Buildings ● 45

Federally Assisted Households

As in the case with the Federal Government’s

commercial buildings, there seems little question

that increased use of existing, proven technologies would reduce a large fraction of the $4 billion

in residential energy paid for by the government

in federally owned and assisted households.

These gains require no change in occupant comfort.

For example, a program of early refrigerator retirement coupled with using the most efficient models

available offers the prospect of reducing Federal

residential electricity expenditures by a few percent.

Such an early retirement program for other appliances such as water heaters and washing machines

could also cost-effectively save both gas and electricity. These energy- and cost-saving appliance

opportunities exist in all types of federally owned

and assisted households.

Since space heating is the leading residential

energy use, many opportunities for energy and cost

savings depend on promoting higher efficiency

heating equipment and weatherization programs.

Opportunities for savings are large. For example, a

comprehensive study of energy-saving opportunities in public housing published by HUD in 1988

estimated the potential for over 30-percent savings

with an average payback of 4.5 years for capital

invested. 25 These results were consistent with a

study performed a decade earlier.26 OTA’s case

study of one public housing authority found that at

least 30-percent gains could be realized using highly

cost-effective measures such as weatherstripping

and insulation. Several field studies of program

implementation have verified that large savings are

possible, although the performance in different

projects has been highly variable.

Results of field studies of low-income weatherization programs (e.g., those funded by HHS and

DOE) have found considerable savings potential,

although results are variable. 27 To gain a better

understanding of the potential gains and best methods to use, DOE’s Weatherization Assistance Program recently began a comprehensive 3-year, $5-

million review of performance. This analysis should

help identify the economically and technically most

effective programs for the future. HHS has not

analyzed the effectiveness of LIHEAP weatherization funds in reducing energy use and reducing the

future need for LIHEAP tiding, but is providing

input to DOE’s Weatherization Assistance Program

study. Analyses of the relative merits of energy

assistance and weatherization assistance have been

largely left to the individual States which administer

the HHS funds.

Although weatherization and rehabilitation programs have been promoted in federally assisted

households, much remains to be done. For example,

HUD’s 1988 study of modernization needs found

that the total one-time investment required to bring

properties up to minimum standards and “enhance

their long-term viability” (including safety, health,

and environmental improvements as well as energy)

amounted to over $20 billion.28 However, annual

spending on modernization has been only $1.6

billion during the past several years.29 Similarly,

each year less than 1 percent of the low-income

households eligible for LIHEAP utility payments

are weatherized under either LIHEAP or DOE’s

weatherization assistance programs.

It is difficult to estimate total spending on energy

efficiency at HUD: funds spent on general rehabilitation often include some energy measures but are

not listed as energy efficiency efforts. For example,

double-pane insulated windows may be used when

replacing broken single-pane windows. The result is

considerable improvement in the building’s resistance to heat loss, but may not be noted as an energy

upgrade. Similarly, repair of flat roofs may be

accompanied by added insulation. Because the primary reason for an energy efficiency upgrade maybe

~~e study idenmledcapit~ improvements and repairs, such as f- windows and upgrading HVAC equipmenc costing $939 millionw~chwotid

save $211 million annually. In addition, window repairs and improved operation and maintenance practices costing $98 million and needing to be

repeated every 3 to 5 years would save$112 million annually. These Operations& Maintenance practices include weatherstripping and caulking. Abt

Associates, “Study of the Modernization Needs of the Public and Indian Housing Stock” HUD-1130-PDR, March 1988, pp. 83-84. Note that HUD’s

total annual utility spending for public housing is around $900 millioq as described previously.

~Per~ & Wiu and Ehrenkrantz Group, op. cit., footnote **.

27see for e=ple, ~ny of tie ~icles fi proceeding~fiom the ACEEE 1990 Summer S&y on Energy Eficiency in Buildings (Washington ~:

American Council for an Energy-Efficient Economy, 1990), vol. 1 to 10.

~Abt Associates, op. cit., footnote 25.

Z9U.S. Housing and Urban Developmen~ “Programs of HUD 1989- 1990,” HUD-214-PA(17), October 1989, P. 75.
46 ● Energy Efficiency in the Federal Government: Government by Good Example?

basic maintenance, keeping track of spending and implementation of efficiency measures is complicated.

ENERGY- AND COST-SAVING

MEASURES: ARE THEY TRULY

WORKING OPTIONS FOR THE

FEDERAL GOVERNMENT?

For nearly every application of energy in residential and commercial buildings, measures are available that can improve the efficiency of use.30 Many,

but certainly not all, have attractive cost and

performance characteristics. Deciding which measures to pursue, if any, often requires careful engineering and economic analyses. Successful programs, those which reduce energy use and overall

costs, also often require ongoing, dedicated efforts to

ensure that they work initially and continue to work.

This section examines some of the useful lessons

from the past decade of energy efficiency programs.

There Are Many Effective Energy

Efficiency Measures

The variety of currently available efficiency

measures and the range of economic and performance characteristics is large. Many currently available measures appear to have excellent economic

and performance characteristics and have been

proven in use, although they are not yet standard

practice. There is a large and growing body of

applied research into the performance of a variety of

energy efficiency programs.31 There is also a large

body of less formal information in trade journals

which report on the results of efficiency measures .32

These report on a continuing stream of successful

energy management efforts following a wide range

of approaches.

New Technologies Do Not Always

Work as Planned

After many years of energy efficiency efforts

throughout the U.S. economy, including within the

Federal Government, it is clear that energy efficiency programs can work well. It is also clear that

some energy efficiency technologies and programs

have not always performed as well as expected. Both

research and trade journals report a steady stream of

projects performing below expectations. (They also

show a steady stream of projects which perform

excellently.) Sometimes new technology does not

perform as it should, as in the case of the excessive

failure rate of some early electronic ballasts. As a

corollary, technologies are continually being imroved and refined, or disappear from the market.

Again, electronic ballasts provide an example with

the high reliability they now have demonstrated.

As with any evolving technology (and as with

many well-established technologies), some products

have marginal to poor performance and economics

but have yet to be driven off the market. Naturally,

this greatly complicates the job of facility managers

in implementing cost- and energy-saving technologies.

Also, because of the wide variety of buildings,

uses, technologies, and other conditions, it is also

possible that good technologies can be misapplied,

resulting in poor performance or unmet economic

expectations. 33 For example, because compact fluorescent lamps are larger and heavier than the

incandescent lamps they replace, there are many

light fixtures in which they cannot be used. Also,

although the color of light produced is good, it is not

identical to incandescent light. A program to replace

all incandescent lamps in a building with compact

fluorescent which neglects those facts could produce considerable dissatisfaction.

Savings Estimates Often Differ

From Actual Savings

Estimates of potential savings are important for

program planning, but the aim of energy management programs is to realize actual reductions in

energy use and overall costs. Analyses of past

energy efficiency programs have often found that

savings were less than expected, sometimes by large

~h ongoing OTA s~dY* “Residential and Commercial Energy Efficiency,” is examining the difference between estimates and actual results

in-depth.

31see for exmple, U.S. Dep~ment of EnerW, BuildingsEnergy Technology, any issue; or Proceedingsfiom theAcEEE Sum?nerStudy on Energy

Eficiency in Buildings (Washingto~ DC: American Council for an Energy-Efficient Economy), Biennial, any issue.

32See, for exwple, any issue of Energy User News, published monwy.

330ne exaple of a publication ~~ch h~ de~]ed @icles about a wide range of energy. sav@s oppo~ties in actil Use is Energy User News,

published monthly. The real world, site-specific information presented there can be of great use in reducing the risk of using new energy efficiency

measures.
Chapter 3--Federal Spending on Energy Used in Commercial and Residential Buildings ● 47

amounts. There are many reasons. Sometimes technologies simply do not perform as planned. Savings

estimates are often based on idealized engineering

analyses which may be distinctly different from

conditions found in practice. Generally, measuring

the actual impact of a conservation measure is

difficult due to the lack of detailed energy use

metering and the variability in use resulting from

weather and occupancy changes.

Applicability of Efficiency Measures

Is Often Site-Specific

Some energy- and cost-saving measures are

generally good practice and should be widely

applied, requiring relatively simple engineering or

economic analysis. For example, use of motion

detectors to control lights in occasionally used

spaces such as restrooms, conference rooms, and

private offices makes economic sense and performs

well in most such circumstances. Eventually, use of

these approaches may become the rule rather than

the exception that they currently are. Another

example is the apparently cost-effective and reliable

combination of high efficiency electronic ballasts

coupled with fluorescent “T-8” tubes.

Other measures have highly site-specific economic and performance characteristics, requiring fairly detailed engineering and economic

analyses. For example, the benefits of adding an

energy management system depend on the type of

heating, ventilating, and air conditioning equipment

in place (and possible plans to replace existing

equipment), as well as the building’s schedule,

external characteristics and internal layout and

occupancy. Similarly, opportunities to delamp, or

reduce lighting in overlit areas, can only be determined from a site survey which evaluates current

lighting levels and the levels which would result

after delamping. While the applicability of these

measures is site-specific, conducting site surveys

including engineering and economic analyses to

identify candidate measures followed by funding,

staffing, and implementation should be a reasonable general practice. To realize the potential cost

and energy savings, the site survey would have to be

followed by detailed audits and implementation

where indicated.34

The desirability of any measure depends on

several factors including the performance, initial

cost, operating costs or cost savings, environmental

impacts, and risk. All measures cost something but

some, such as performing preventive maintenance

on steam traps are nearly free, are well-proven (thus

entail little technical risk), and can generate considerable savings. Other measures, such as replacing

existing low efficiency light fixtures and lamps with

high efficiency systems, may involve a capital

expenditure which is rapidly paid back through

reduced operating costs. Still other measures, such

as the early retirement and replacement of a moderately efficient air conditioner with a more efficient

but commercially unproven unit, may or may not

pay back.

Successful Implementation Often

Requires Ongoing Effort

Energy efficiency measures generally involve

change. There are changes either to equipment or to

operating and maintenance practices, and there are

continuing changes in the available technologies. At

any facility, ensuring that the best practices and

equipment are being applied requires ongoing,

dedicated effort. This is critical not only for ensuring

that the technologies work as planned and for

refining them when needed, but also for separating

successful approaches from poor ones.

EFFICIENT TECHNOLOGIES

FOR MAJOR ENERGY USES

This section examines some of the main energy

uses found in Federal commercial and residential

buildings, and some technologies applicable to

energy efficiency gains. 35

Lighting

Lighting is ubiquitous in commercial buildings,

and is responsible for around 25 to 50 percent of

electricity use in those buildings. In addition to the

energy used directly by the lights, heat produced by

~For an in-depth discussion of energy audits, See Albert ~~ Handbook of Energy Audits (Lilbur@ GA: Fairrnont Press, Inc., 1983).

ssFor an etiustive description of a wide range of energy efficient measur es, see for example, Architect’s and Engineer’s Guide to Energy

Conservation in Existing Building: Volume 2-Energy Conservation Opportunities, prepared for U.S. Department of Energy, DOE~1830P-H4,

April 1990. That report describes 118 energy conservation opportunities using currently available products which could be considered for cmnmexcird

buildings. Also see Battelle-Columbus Division and Enviro-Management & Research, Inc., DSM Technology Alternatives, EPRI EM-5457 (Palo Alto,

CA: Electric Power Research Institute, October 1987), for descriptions of 99 energy efficiency technologies which can affect electricity use.
48 ● Energy Efficiency in the Federal Government: Government by Good Example?

lights contributes significantly to air conditioning

loads in commercial buildings, indirectly contributing to additional electricity demand. Lighting is afar

smaller contributor to residential energy use, but still

affords some economic opportunities.

Many lighting measures for commercial building

applications have been heavily researched over the

past two decades.36 During this time, a wide range of

approaches and products for improving the performance of lighting have been pursued and implemented. Several lighting measures now available

appear to offer considerable energy- and cost-saving

potential, with attractive reliability and performance. (Table 3-2 summarizes the main approaches to

the more efficient use of electricity for lighting.) The

three main approaches are: reduce unneeded illumination, increase efficiency of lamps, and increase

efficiency of fixtures.

General Services Administration together with

the Department of Energy (DOE) have announced a

$10-million program to make use of energy efficient

lighting measures in the National Capital Region.

This program will take advantage of an energy

efficiency incentive program offered by the Potomac

Electric Power Co., the local electric utility.

The Defense Logistics Agency (DLA) takes the

lead for Federal procurement of lamps and ballasts

and resale to other agencies. In 1989, this responsibility was transferred from GSA, which retains main

responsibility for other lighting products such as

futures. DLA does not emphasize high efficiency

products in its role as main provider of bulbs and

ballasts.

Reduce Unneeded Illumination

Delamp overlit areas, use task lighting. Any

effort to reduce illumination levels needs to be based

on a careful, site-specific analysis of illumination

requirements. Failure to do so can cause worker

dissatisfaction and perhaps reduced performance,

neither of which are consistent with energy efficiency efforts.

However, buildings often have higher illumination levels than needed for occupant comfort.

Minimum illumination levels are specified by facilTable 3-2—Lighting Efficiency Measures

Reduce unneeded illumlnat!on

Delamp overlit areas

Use task lighting

Use lighting controls

Occupancy sensors and timers

Daylight with automatic dimmers

Increase efficiency of lamps and ballasts

Use high-efficiency lamps

Use high-efficiency ballasts

Increase efficiency of light fixtures

Use refIectors and high-efficiency fixtures

Clean and maintain fixtures

SOURCE: Office of Technology Assessment, 1991.

ity engineers, the Illumination Engineering Society,

and others depending on the type of activity. For

example, GSA requires 50 foot-candles of illumination for desks, and 30 foot-candles for hallways.

Lighting levels can be reduced very inexpensively

by removing lamps, as in the case of removing two

lamps and disconnecting one of the ballasts in a

four-lamp fixture. Using lower output lamps may

also reduce power, as in using 34-watt fluorescent

tubes to replace standard 40-watt tubes. In this case,

the 34-watt tubes are slightly more efficient than the

40-watt tubes, and light levels are not proportionately reduced. Task lighting allows reducing overall

light levels by increasing light on the desk or

working surface.

Use lighting controls such as occupancy sensors, timers, and daylighting with automatic

dimmers. A variety of methods for turning lights off

when not needed have been developed and demonstrated in practice.37 Turning lights off which are not

needed can both reduce energy use and extend

replacement time for the lamps. Frequent switching

reduces fluorescent lamp operating lives, but with

modern tubes only a short period of being turned off

compensates for the additional switching. Automatic switching using occupancy sensors is more

reliable and convenient than manual switching, and

is well suited to bathrooms, conference rooms, and

some hallways and private offices. Simple timed

switches are inexpensive, and perform well in

locations such as storerooms. Several brands of

occupancy sensors have established good operating

records, and when installed in a suitable location

Sssee ~bert ~U~ Lighting Efi”ciency Applications (Lilburn, GA: Fairrnont ~ess ~c., 1989).

sTSee, for ex~ple F. Rubinstein and R. Verderber, ‘‘Automatic Lighting Controls Demonstration,” prepared for Paciilc Gas& Electric Co., March

1990. This project, which combined a variety of control strategies centering around dimmm“ g electronic ballasts, demonstrated savings ofover50percx-mt

with a payback of under 2 years for a small office space.
Chapter 3--Federal Spending on Energy Used in Commercial and Residential Buildings . 49

have good economic characteristics. Detailed site

surveys and analyses are not required for occupancy

sensors and timers. However, a reasonable estimate

of the schedule of use of lights and the opportunity

for curtailing use is needed.

Automatic dimming controls sense lighting levels

and turn down lights when daylight is present. They

may be suitable for use in offices at building

perimeters or near skylights. Daylighting is finding

increased use in new buildings and retrofits, but is

not widely applied. Opportunities are highly sitespecific.

Increase Efficiency of Lamps and Ballasts

Tremendous advances have been realized in the

efficiency of bulbs and ballasts over the past decade,

many of which are not widely used in Federal

facilities. Most of the commonly used types of

lamps, including fluorescent, incandescent, mercury

vapor, metal halide, and high- and low-pressure

sodium, have all had significant performance improvements. Demand for some new high-efficiency

compact fluorescent lamps and electronic ballasts

has grown so rapidly that it may outstrip supply .38

Fluorescent Lamps and Ballasts—Many high

efficiency lamps and electronic or hybrid electronic/

magnetic ballasts that replace standard fluorescent

tubes and standard magnetic ballasts have been

commercialized. Laboratory studies indicate that the

most efficient combination presents savings opportunities of up to 39 percent compared with standard

tubes and ballasts.39 Table 3-3 compares the efficiency of different combinations of ballasts and

lamp efficiencies for ‘‘cool white” 4-foot tubes. At

least some of the products available have been

well-proven in widespread use and noted in industry

press.

40 In 1988, electronic ballasts captured around

4 percent of the market, a small amount but enough

to prove reliability .41

Table 3-3 also shows the bulk costs of ballasts and

tubes. Generally, the higher the efficiency of lamps

and ballasts, the higher the first cost. However, the

cost of lamps and ballasts is less than the cost of the

electricity those components will use in their lifetime. Paybacks for replacement and for use in new

construction are often rapid, under 3 years. For

example, the T-8 tubes and electronic ballasts appear

to have clearly superior economic characteristics

compared with standard fluorescent for use in new

construction and when existing components reach

the end of their life. Performance is comparable or

superior to that of standard systems, with better color

and reduced flicker, although some ballasts may

generate power quality problems such as unwanted

harmonics. In many cases, early replacement (e.g.,

replacing a still-functioning lamp) with high efficiency components is economically attractive.

Prior to 1990, standard magnetic ballasts, hybrid

electronic/magnetic ballasts, and electronic ballasts

were all available in the commercial market from

several manufacturers. However, the National Appliance Efficiency Act of 1988 set a minimum

efficiency standard for most common ballasts which

removes standard ballasts from the domestic market.

Even though the least efficient ballasts are no longer

manufactured, existing stocks are still marketed.

This, together with their long 10-year lifetime,

means that these costly-to-operate devices will

continue to consume excessive amounts of electricity and Federal energy dollars for several years.

Incandescent Lamps—While the majority of

lighting fixtures in most commercial buildings are

fluorescent, some incandescent lamps are also used.

In contrast, most residential lighting is incandescent.

Over the last few years, fluorescent lighting technology has gradually improved, with the lights gradually becoming small and light enough to substitute

for screw-in incandescent lamps in certain fixtures.

These compact fluorescent lamps consume only

about 25 percent of the power of a standard

incandescent lamp of the same light output. However, compact fluorescent lamps remain considerably heavier and larger than incandescent lamps, and

thus cannot always be used in the existing fixtures.

38C 6AS DSM Rograms G@ consultant Warns of Possible Lamp Shortages, ’ Electric Utility Week, Feb. 25, 1991, p. 14.

ss~~pe~o-nce of Electronic B~lasts and Li@ting Controllers With 34-W Fluorescent Lamps: FM Report, ” ~wrence B~keley ~borato~,

February 1988.

~see for e~ple, R.S. Abesamis, P. Bbc~ ~d J. Kessel> “Field Experience With High-Frequency Ballasts, ” IEEE Transactions on Zndusfry

Applications, vol. 26, No. 5, p. 810811, which describes the successful application of over 45,000 high-frequency electronic ballasts at the University

of California at Berkeley.

41u.s. Departmentof Energy, ‘ ‘Trends inEnergy-Efficient Lighting, Conservation and RenewableEnergy Inquiry and Referral Service (C AREJRs),

March 1990.
50 ● Energy Efficiency in the Federal Government: Government by Good Example?

Table 3-3-Comparison of Fluorescent Lamps

(77 test room— 4-lamp recessed troffer, plastic lens)

Ballast Relative light Relative light

Lamp type Ballast factor 1a Wattsa Output 2 a output/watt a cost 5 b c

T-12 standard (40 W) . . . . . . . . . Standard magnetic40.95 174 100 100 n/a

T-12 energy-saving (34 W) rare

earth tri-phosphor . . . . . . . . . . Standard magnetic40.90 155 93 104 n/a

T-12 standard (40 W) . . . . . . . . . Energy-saving magnetic 0.95 162 101 108 26.80

T-12 energy-saving (34 W) rare

earth tri-phosphor . . . . . . . . . . Energy-saving magnetic 0.88 139 91 114 27.80

T-8 lamp (32 W) 3 . . . . . . . . . . . . . T-8 electronic 0.92 106 98 161 47.80

NOTES: 1. Data in test normalized to ballast factors shown in this column for magnetic ballasts. Factors shown for electronic ballasts are measured values

of sample.

2. Relative light output based on initial (100 hour) rated lamp lumen output.

3. Life rated at 15,000 hours. All other systems shown are rated at 20,000 hours.

4. Standard magnetic ballasts are only available for export since the National Energy Appliance Conservation Act (NEACA) passed in 1989.

5. Cost column is the cost of the lamp multiplied by four, plus the cost of the ballast.

SOURCES: aNational Electrical Contractors Association.

bJim Osborne, Magnetek, personal communication, FetmarY 1 Ml.

cCustomer Service, General Electric Lighting, personal mmmunication, Mar. 11, 1991.

A compact fluorescent lamp is far more expensive

than the incandescent it replaces. For example, a

15-watt compact fluorescent purchased by the Federal Government costs around $7, compared to about

$0.30 for the 60-watt incandescent it replaces.42

However, savings on both energy costs and maintenance costs can be very high if the lamp operates a

few hours a day or more. For example, for lights

turned on 8 or more hours per day on weekdays,

compact fluorescent lamps can pay for themselves in

under 1 year.43 Maintenance savings result because

the fluorescent lamps have a lifetime 10 times longer

than standard incandescent, potentially decreasing

maintenance and replacement costs considerably.

However, for an incandescent turned on only 1 hour

per day, the potential savings are small relative to the

cost of a compact fluorescent.

Use of compact fluorescent replacements for

incandescent lamps is increasing in the commercial

sector. However, further advances (notably in size

and weight) are necessary before they become the

rule rather than the exception for even heavily used

lights. For occasionally used lights, considerable

reduction in first cost is also necessary.

For incandescent fixtures in which compact

fluorescent lamps are too heavy or too large to work,

higher efficiency incandescent are available which

reduce consumption by 10 to 20 percent and produce

the same light output.

Use High Efficiency Fixtures

In the past several years, a large number of new

fixtures have been marketed, intended to improve

the distribution of light, increase efficiency, and

improve visual comfort. The key features of high

efficiency fixtures are reflectors and lenses which

direct light toward the working space. High reflectance silver or aluminum reflectors inserted into

fluorescent fixtures can increase fixture efficiency

by 20 to 35 percent.44 Also, because the efficiency of

fluorescent tubes decreases outside a certain range of

operating temperatures, a feature of efficient fixture

design allows heat dissipation to maintain optimal

bulb temperatures.45 Measuring the performance ‘f

fixtures is difficult, depending not only on the level

of illumin ation resulting, but the distribution of light

at the working surface.

‘$2&nera.1 Electric Customa’s Service, personal commticatioq Mar. 26, 1991.

d3~@ sav~gs in cost-of-energy is about:

(8 hour/day)* (235 days/year)* (0.045 kilowatts)* ($0.07/kilowatt-hour) = $6/yew,

Incandescent lamps, with an average lifetime of 1,000 hours, must be replaced twice per year if operated 8 hours daily, so the compact fluorescent

additionally saves about 1/2 hour of labor, approximately $10 for typical maintenance workers. Note that benefits from reduced maintenance may not

accrue if maintenance workers are made idle but remain on the payroll.

aT.K. McGowan and H.H. Whitmore, “Performance of Fluorescent Reflector Inserts,” GE Lighting, Nela PsrlL ON undated.

4SSee Energy con~emation Potential A~~ociated With The~l[y Eficient FIWrescent F~mres, ~wrence Berkeley hboratory, CA, prepared for

Department of Energy, Washington DC, June 89.
Chapter 3--Federal Spending on Energy Used in Commercial and Residential Buildings ● 51

Photo credit: Christine Onrubia

Compact fluorescent lamps are nearly four times more

efficient than incandescent lamps, but are too large

to fit in many popular fixtures.

To keep any fixtures operating optimally, basic

maintenance in the form of cleaning is required. The

light from very dirty fluorescent fixtures and lamps

may be less than 70 percent the light from the same

equipment when clean.

46 It is possible that high

efficiency fixtures may be more susceptible to

dirt-induced degradation than standard counterparts.

Future Directions in Lighting Efficiency

Advances in lighting technology are continuing

along a variety of fronts. Better lamps, ballasts, and

fixtures are all being pursued by manufacturers.

These efforts should continue to improve the prospects for efficiency, applicability, and customer

acceptance. One area which could benefit from

additional effort is product testing. Performance,

including efficiency, visual comfort, and reliability

of new products is often difficult to gauge. Because

lighting technologies are constantly evolving, systematic testing and reporting from a reliable source

could be of considerable help to building managers,

with their limited time and resources to explore the

vast array of available options.

Heating, Ventilation, and Air Conditioning

As with lighting, HVAC is ubiquitous in commercial and residential buildings, including those owned

and assisted by the Federal Government. In many

buildings, heating, ventilating, and air conditioning,

in total, account for the majority of both electric

energy use and energy use overall.

During the past two decades, many approaches

have been heavily researched which can reduce the

energy needed for heating, ventilating, and air

conditioning. 47 (Table 3-4 s ummarizes the main

approaches to the more efficient use of energy for

HVAC.) The two main approaches are: improve the

building envelope and increase efficiency of HVAC

equipment including efficient operation and maintenance.

Improve Building Envelope

HVAC use depends in part on the amount of heat

gained (during summer) or lost (during winter)

through a building’s envelope (the exterior walls,

windows, doors, roof, and floors). Envelope improvements control heat gain or loss to reduce the

load on HVAC systems. With many HVAC-related

measures, retrofitting existing buildings is more

difficult and expensive than installing them during

construction, highlighting the importance of good

initial design for new Federal buildings.

Infiltration, the unintended and uncontrolled entry

of outside air into a building, may add considerably

to a building’s heating and air conditioning load.

Some measures to control infiltration such as

caulking and weatherstripping doors and windows,

and ensuring windows are kept closed when HVAC

is being used, are low cost and part of a good,

ongoing facility maintenance program. These measures should be pursued at all Federal facilities. Other

measures such as adding vestibules or revolving

doors or vapor barriers in walls require capital

spending but may be worthwhile in some buildings.

Conduction, the transfer of heat through walls,

roofs, windows, floors, and doors, also contributes to

heating and air conditioning demand. Opportunities

for adding insulation in any Federal facility depend

greatly on the type of building, including its age,

location, condition, type of construction, and existing insulation. There are a variety of insulation

products available for walls, floors, and ceilings,

some of which have been manufactured using

chlorofluorocarbons (CFCs). These products will be

461~ uminating Engineering Society, Lighting Handbook (New York, NY: 1972).

q7F~r anin.de~~ di~cu~~ionof many ~e~.e~tablished me~mes, see D. pad Mehta and A. ~~~HandbOOkOfEnergYEnginee~ng (Lilb~ GA:

Fairmont Press, Inc., 1989).
52 Energy Efficiency in the Federal Government: Government by Good Example?

Table 3-4—HVACa-Related Efficiency Measures

Improve the building envelope

Reduce infiltration

Caulk and weatherstripping

Vestibules and revolving doors

Insulate

Roofs walls, floors

Storm doors and windows

Vapor barriers in roofs and walls

Reduce solar heat gain through windows and roofs

Shading

Reflective window films

Reflective roof surfaces

Increase efficiency of HVAC systems

Perform system maintenance regularly

Operate equipment efficiently

Install and use an energy management system

Install efficient equipment

Ventilation equipment

Chillers, air conditioners, and cooling systems

Boilers and furnaces

Distribution systems

aHeating, ventilation, and air conditioning.

SOURCE: Office of Technology Assessment, 1991.

effected by restrictions on production and use of

CFCs due to the atmospheric environmental impacts. Both relatively new and long-existing products are also available to decrease conduction

through doors and windows. Storm doors and

windows, a long-proven technology, reduce heat

gain or loss. New “low emissivity” or “insulating

glass” windows, used with or without storm windows, can greatly further reduce heat transfer.

Solar heat gain through windows and roofs can

add considerably to cooling loads and decrease

winter heating loads. Both window and roof solar

heat gain can be controlled using simple and

inexpensive measures in many cases. For example,

the amount of solar heat gained through a roof can

be reduced by using reflective or light-color paints

on the roof. Solar heat gained through windows can

be reduced using reflective films or shading, either

with roof or wall overhangs or with trees for some

low buildings. The benefits of measures to control

heat gain depend on many factors including building

size, orientation toward the sun, side of the building

effected, and climate. Selecting measures requires a

careful analysis of these factors as well as the

tradeoff between the benefits in s ummer and the

potential losses in winter.

Increase Efficiency of HVAC Systems

Space heating in Federal facilities is provided

with a variety of equipment. Most facilities use

natural gas or oil in a boiler which makes steam or

hot water, or a furnace which makes warm air. The

steam, hot water, or warm air is distributed through

a building using a system of pipes or ducts. Many

buildings also use electricity for heating, using heat

pumps or electric resistance heaters, which often

need no distribution system.48 There is a similar

variety of cooling equipment including central

chillers which produce either chilled water or air,

and local heat pumps or air conditioning units.

Often, the same system of pipes or ducts is used for

both heating and cooling, depending on the season.

Preventive Maintenance--Besides turning equipment off when not needed, the simplest and most

basic energy efficiency measure for HVAC systems

is a program of regular preventive maintenance. All

HVAC system equipment including distribution

equipment, requires regular maintenance for peak

performance and efficiency, but will continue to

function (inefficiently) even if not properly maintained, For that reason, regular preventive maintenance, rather than maintenance when equipment

fails is essential.

The list of maintenance items can be long and

depends on the specific equipment.49 Some maintenance steps such as cleaning burner tips in boilers

using heavy fuel oil and checking controls may be

required as frequently as daily and may almost be

considered part of efficient operations. Others need

to be performed weekly or monthly or annually.

Examples include such functions as cleaning or

replacing air filters in ducts and air conditioners,

cleaning boiler surfaces, cleaning evaporators and

condensers in chillers, and repairing leaks in ducts,

pipes, and boilers. Simple maintenance steps, if not

already being performed, could lead to considerable

cost savings.

Anecdotal evidence indicates that at least some

potential gains exist. For example, one study of the

HVAC system at DOE’s Forrestal building in

au-s. De~~ment of Energy, Ener~ ~omation A&nifis@ation, Nonresidential Buildings Energy consumption Su~eY: co~rcial Buildings

Consumption and Expenditures 1986, DOE/EIA 0246(86) (Washingto~ DC: U.S. Government Printing OffIce, May 1989), p. 168.

d~or a discussion ofm~temnce Practims, see Paul D. Mehta and A. Thumam Handbook of Energy Enginee~”ng @.ilbu~ GA: F~ont press,

Inc., 1989), ch. 14, “Energy Management. ”
Chapter 3-Federal Spending on Energy Used in Commercial and Residential Buildings ● 53

Washington, DC found that an intensive program of

steam trap maintenance and repairs together with

simple operational changes such as turning the

steam system off on weekends reduced total building energy costs by over 6 percent, or $260,000.50

Similarly, one review of twelve variable-air-volume

air conditioning systems at six Navy facilities found

that ‘the general level of operating and maintenance

services being supplied is very poor and not

sufficient to make . . . systems function properly.

There appears to be no effective preventive maintenance/inspection program. ’ ’51 Finally, at OTA’s site

visits to four federally owned facilities, personnel in

at least two sites expressed some doubt that HVAC

maintenance or operations were carefully conducted

for efficiency. There seem to be no systematic

mechanisms or incentives to ensure that HVAC

systems in Federal facilities are properly maintained

for peak efficiency. This is not to say that Federal

agencies ignore operations and maintenance issues.

GSA, for example, requires building managers to

keep plans for efficient operation, and has standards

for maintenance intended to ensure efficiency.

Examining the different approaches taken by Federal agencies and private-sector facility managers to

see which work best, and applying those methods

throughout Federal facilities could be very productive.

Efficient Operation-Closely related to efficient

maintenance, efficient operation is another low cost

measure to minimize energy use and cost. Efficient

operation involves carefully monitoring ambient

temperature and humidity as well as heating and

cooling demand, and operating equipment accordingly. As with maintenance, there are a variety of

measures to pursue which together help ensure

efficient operation. For example, in systems with

multiple chillers, efficiency can be improved by

isolating one or more units during periods of light

cooling demands (e.g., early mornings). Another

simple method is to adjust boiler or chiller output to

the minimum required level, which depends on

heating and cooling demand. Also, use of economizer cycles, which use outside air for cooling when

temperature and humidity are suitable, can produce

substantial savings. The opportunities for energyand cost-savings from efficient operations depend

on the type of equipment, the characteristics of the

facilities, and the efficiency of current operations.

Energy Management and Control Systems—

Sometimes, adding new equipment can help improve the efficient operations of existing equipment.

One type of such equipment, developed largely to

ensure efficient operations of existing HVAC systems, is the building energy management and control

system (EMCS). There are several commercial

vendors of EMCS.

The functions performed by an EMCS can be as

simple as shutting off the HVAC system after

normal business hours. However, there are also

increasingly sophisticated, computer-based systems

with perhaps thousands of temperature and humidity

monitoring points throughout a facility, as well as

monitors of ambient conditions and HVAC equipment performance. This information, coupled with

detailed, automated control of the HVAC equipment’s fuel, air, temperature, and other equipment

settings, can be used to minimize energy and

operating cost. Also, the remote and continuous

monitoring of the performance of HVAC system

components allows operators to identify areas needing maintenance. For example, an EMCS can

continuously monitor the input and output water

temperatures and fuel use in a boiler, which together

indicate the boiler’s efficiency. Reduced efficiency

indicates that maintenance is needed, possibly as

simple as cleaning boiler surfaces or burners tips.

Properly installed, maintained, and used, an

EMCS can greatly aid in reducing operating and

maintenance costs. It also can help measure and

document energy savings. However, it is not a magic

tool. To reach its full potential, an EMCS requires

not only a combination of good equipment, and

proper design and installation by the vendor, but also

an ongoing period of training, followup work, and

maintenance by the HVAC operators. HVAC operators need to have time to dedicate to learning the

system capabilities, and experiment with different

approaches to using both- the HVAC and EMCS

equipment. For example, operators can experiment

with different boiler temperature settings which

~Jeff S’. I-Iaberl and E. James VaJd% ‘‘Use of Metered Data Analysis To Improve Building Operation and Maintenance: Early Results From Two

Federal Complexes,” paper presented at American Council for an Energy-Efficient Economy, 1988 Summer Study on Energy Efficiency in Buildings,

Asilomar, CA, Aug. 28 to Sept. 3, 1988.

s~Tom R. Todd, “=ten~ce of Variable-Air Volume WAC Systems, “ in Federal Construction Council, Technical Report No. 95: Maintenance

of Mechanical Systems in Buildings (Washington DC: National Academy Press, 1990), pp. 19-23.
54 ● Energy Efficiency in the Fe&v-al Government: Government by Good Example?

depend on ambient temperatures and humidity, as

well as temperatures and humidity at different points

within the buildings being heated. Because every

facility is unique, the opportunities for EMCS to

improve HVAC operation must be individually

tailored. This requires a capable, well-trained, and

interested operations staff.

Many EMCS’ have been installed in Federal

facilities, and individual agencies have supported

ongoing efforts to improve their performance. However, results to date are mixed.52 All of the four

federally owned commercial facilities in OTA’s site

visits had some sort of EMCS equipment, some of it

fairly old. However, in at least two cases the EMCS

equipment was not being used as intended in its

design, apparently due to some combination of

improper design, installation, maintenance, and

training. According to one study, “. . . Federal

agencies have had significantly more HVAC control

problems than private owners. ”53 That study suggested that adopting some private sector approaches

could improve performance in Federal facilities.

Those include giving consulting engineers more

flexibility in designing systems; requiring consulting engineers to write more detailed specifications

(e.g., the accuracy and location of thermometers and

the precise conditions which should cause valves to

be opened or closed); and involving the consulting

engineers in the installation and startup of new

systems to ensure they are properly operational and

that agency personnel are properly instructed.

Install Efficient Equipment

Much HVAC equipment in use today in Federal

facilities is quite old. Large improvements have

occurred in the efficiencies of chillers, air conditioners, boilers, furnaces, and the motors which power

pumps and fans in HVAC equipment. 54 For example, a new packaged air conditioning unit may

consume 30 percent less energy than one manufactured in the 1960s. High efficiency heat pumps have

attractive cost and performance characteristics in

warmer climates, providing both air conditioning in

summer and space heating in winter. As old equipment is replaced over time, efficiency will generally

increase. However, there is a fairly wide range of

efficiency in equipment being produced today.

Typically, higher efficiency equipment is more

expensive than less efficient counterparts, but generates cost savings over its long life. Trading off

between higher frost cost and lower operating costs

requires careful engineering and economic analysis.

Some components can be kept working for

decades. Because equipment costs are high, replacing working equipment is often not cost effective.

Still, some of the HVAC equipment in Federal

facilities may be past its economic life. Unfortunately, analysis of whether replacing an existing unit

would reduce net costs is usually not made: equipment is used until it ceases to work.

Miscellaneous Energy Uses

Miscellaneous energy uses include everything not

mentioned above. They are a small but rapidly

growing portion of building energy use, with developments such as office automation and computing,

advanced medical scanning technologies, and simulators gaining use. Some of the other many miscellaneous uses are more traditional, such as water

heating, cooking, refrigeration, and elevators.

There are many opportunities for efficiency improvements in miscellaneous energy uses (see box

3-A). For example, water heating for commercial

use can be made more efficient with well-proven

approaches including using new heaters with pulsed

combustion and better insulated tanks, and insulating distribution piping. Another example of an

opportunity for increasing miscellaneous use efficiency is in new electric motors. Motors are used in

a variety of commercial applications, from elevators

to HVAC pumps and fans to postal automation

equipment. The most efficient electric motors available in today’s markets are considerably more

s@OraneXample of asystemw~c~~to &tefailed to meet expectations, see F. Boerckerand J. McEvers, ‘‘A Post-Installation Review of the Energy

Monitoring and Control System at Red River Army Depo~’ Oak Ridge National Laborato~, O RIWJTM-10137, May 1990. Other installations have

had successful EMCS applications. See, for example, Douglas A. Decker, “A Self Financing Energy Conservation Concept for the Federal

Government,” Strategic Planning for Energy andthe Environment, vol. 10, No. 3, winter 1990-91, pp. 64-66, which describes cost savings at the U.S.

Army’s Fort EuStiS, VA USi13g EMCS.

Sssee Building Rese~ch Board, Natioti Research Counci~ Controls for Heating, Ventilating, and Air-Conditioning Systems @kh@tO% DC:

National Academy Press, 1988), pp. 23-24,43,44.

~For a description of high-efficiency electrical HVAC equipmen$ see Resource Dynamics Corp., Handbook of High-E@ciency Elecmic E~”pment

and Cogeneration System Opn”onsfor CommercialBuildings, EPRI CU-6661, December 1989; and D.W. Abrams, P.E. & Associates, Commercial Heat

Pump Water Heaters Applications Handbook, EPRI CU-6666 (Palo Alto, CA: Electric Power Research Institute, January 1990).
Chapter 3----Federal Spending on Energy Used in Commercial and Residential Buildings ● 55

Box 3-A—A New, Improved Exit Sign: What D#ference Could It Make?

There are hundreds of thousands of exit signs in Federal commercial buildings, consuming in total several

megawatts of power around the ciock.

Exit signs are one excellent example of energy- and cost-saving technological progress, even though they

represent only a tiny fraction of total electricity use in buildings. For decades, exit signs in commercial buildings

have commonly been lit by a pair of standard incandescent lamps. Though at $0.20 each they are cheap to buy, these

lamps are expensive to use since they operate inefficiently around the clock. Each sign consumes from 210 to 1,050

kWb/year at a cost of $15 to $75; the need to replace these

lamps as they burn out as often as every 2 months adds

around $60 annually to their total cost. ~

By replacing the incandescent lamps in existing signs

with compact fluorescent lamps, energy costs are considerably decreased to between $7 and $11. Even more significantly, the 10,000-hour life of a compact fluorescent means

the $6 lamp needs replacement less than once per year,

giving an average annual maintenance cost of only $14. The

total annual savings compared to an incandescent exit sign

are between $55 and $110. Lower operating and maintenance costs in the first few months alone more than pay

back the higher initial lamp and ballast cost of $15 and

installation.

While the compact fluorescent is a clear advance over

incandescent-based exit signs, a further improved exit sign

technology has recently been commercialized. Exit signs Photo credit: Gilbert Emergency Lighting

relying on light-emitting diodes (LED) are even more energy

efficient and less expensive to operate, using as little as 6.7 If used in all Federal facilities, exit signs using lightwatts. Furthermore, these signs need infrequent replacement emitting diodes could be a cost-effective way to save

or maintenance (the electrical components have a life several megawatts of electric generating capacity.

expectancy of 25 to 30 years). LED signs are available under a General Services Administration authorized Federal

Supply Schedule2 for as low as $71.47, only slightly more expensive than a new exit sign using incandescent lamps

and actually less expensive than anew sign with a compact fluorescent.3 Thus, when purchasing new exit signs (e.g.,

for new construction), LEDs should produce net cost savings right from the start or soon thereafter. Even when used

to replace an existing fluorescent-lamp exit sign, they should produce a simple payback of under 4 years.

1~~ ~x=ple ~~es tie following assmptiom: elwtrici~ costs $0.07/k~ each standard fixture uses a ptiof ~c~descent lamPs tot~g

from 24 to 120 watts, or a single 12-to 18-watt compact fluorescent; average incandescent lamp life is 2,000 hours; lamp replacement requires

$10 in labor costs which can be put to other productive use or displaced. Note that ifa facility has surplus maintenance workers, labor cost savings

will not actually aeerue, These assumptions are adapted from “Exit Signs: Save Energy and Money,” Energy & Environmental News, Naval

Energy and Environmental Support Activity, Port Hueneme, CA (reprinted in U.S. DOE, FEh4P Update, Federal Energy Management Program,

winter 1988, p. 11).

2GSA con~act ~S07F.186zA with Don Gilbert Industries, hc., W. 26, 1990 to Aug. 31, 1994.

3St~dmd clwtic~ exit signs USing incandescent lamps cost as littte as $61.50. GSA Contract Catalog GS07F-18188, Mar.1, 1990 to Aug.

31, 1994, EMED Co., Inc., p, 11. While the lamps are described in the catalog as “extra long life energy saving lamps,” aeeording to the

manufacturer they are incandescent rather than fluorescent. Telephone conversation with customer services department, Nov. 26, 1990.

—.

efficient than older motors (also far more efficient Refrigerators

than the least efficient models currently available). Refrigerators offer an opportunity for a large

Also, developments in adjustable speed drives can reduction in electricity use in the 9 million federally

create higher efficiencies by allowing a motor’s owned or assisted households. Each year around half

electric power input to vary with the load and may a million new refrigerators are purchased for these

be suitable in some applications. households. The average refrigerator now operating
56 ● Energy Efficiency in the Federal Government: Government by Good Example?

in the United States uses over 1,500 kWh/year. 55 The

most efficient commercially available models of

similar size use less than 60 percent of that amount. 56

The stock of refrigerators in federally owned and

assisted households may include smaller units with

fewer energy-using features, such as through-thedoor ice and water dispensing, than the national

average, slightly reducing the average potential

gains there.

Some of the potential is gradually being captured.

The National Appliance Energy Conservation Act of

1988 (NAECA) set minimum standards for several

appliances, including refrigerators. However, even

with NAECA, the long lives of refrigerators (over 15

years) ensures that inefficient units will continue to

be used in Federal facilities for many years unless

retired early. Further, even as refrigerators are

replaced in federally owned and assisted households, there is no guarantee that the most energy

efficient units will be selected rather than those

minimally meeting the standards. As in the purchase

of any energy-consuming device, several factors

such as durability and features must be considered as

well as first cost and energy use when selecting a

refrigerator. In addition to opportunities in buying

more efficient refrigerators, regular maintenance

(i.e., cleaning condenser coils) can improve efficiency.

New Miscellaneous Uses

Most new miscellaneous energy uses rely on

electricity. All are used because of the significant

improvements in performance or productivity they

bring. These new miscellaneous uses contribute to

increasing energy use at Federal facilities (or smaller

energy savings). However, these increasing uses of

energy are not only legitimate, but may be essential

to increasing overall Federal productivity and services. For example, use of automated mail sorting

equipment can increase energy consumption in mail

facilities (see case study of the U.S. Postal Service

San Diego Division in ch. 5). At the same time, it

helps speed deliveries and reduce labor requirements.

Some new miscellaneous energy uses, while

increasing electricity use in the Federal buildings

can actually contribute to reduced overall energy

use. For example, military use of simulators has

increased tremendously over the past decade. Military training on simulators is used for a wide range

of equipment, including various aircraft, tanks, and

even small arms. A flight simulator can use a considerable amount of electricity. However, the amount

of jet fuel used in an actual training flight is far more

than enough to compensate for the electricity.

55u.s. Depmrnent of Energy, Energy ~orrnation Administration, Housing Characteristics 1987, DOEEXA-0314(87) wMti@XL DC: U.S.

Government Printing OffIce, May 1989), p. 10.

SC1990 DireCtO~ of Certifi”ed R@’gerators and Freezers (Chicago, IL: Association of Home Appliance Manufacturers, J~UWY 1990).
Federal En

General

ergy Use in

Operations
Contents

Page

FEDERAL GENERAL OPERATIONS ENERGY USES . . . . . . . . . . . . . . . . . . . . . . . . . 59

PASSENGER VEHICLES AND TRUCKS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60

Automobile Fuel Economy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61

Maintenance and Driver Training . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62

Teleconferencing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... ... 62

Alternative Fuels and Vehicle Design . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63

Figures

Figure Page

4-1. General Operations Costs, Fiscal Year 1989 .. .. .. .. .. .. ., .. .. ... ... ...... ..... 59

4-2+ Operations Energy Use by Fuel, Fiscal Year 1989 .. .. .. ., .. ... ... .... . 60

4-3. Federal Fleet Data, Fiscal Year 1988 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ........61

Table

Table Page

4-1. Partial List of Agency Teleconferencing Facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Chapter 4

Federal Energy Use in General Operations

FEDERAL GENERAL

OPERATIONS ENERGY USES

General operations energy uses in the Federal

Government can be grouped into three categories:

passenger vehicles and trucks; other vehicles and

transport equipment (e.g., military aircraft and

Naval fleets); and energy-intensive processes and

equipment such as uranium enrichment facilities.

The great majority of the $4.8 billion spent on

general operations energy in fiscal year 1989 was

used for military mobility, including $3.6 billion for

jet fuel (see figure 4-l). Much of the remaining

operations energy use is also defense-related, used

by the Department of Defense (DOD) in various

processes and by the Department of Energy (DOE)

in its uranium enrichment facilities and production

nuclear reactors. Production reactors are industrial

facilities for producing nuclear weapons material

and nuclear fuel. Nondefense operations using large

amounts of energy include DOE’s research facilities

such as reactors and linear accelerators.

General operations accounts for 92 percent of

Federal petroleum use.1 Again, the great majority of

this petroleum is for jet fuel, and much of the remainder is used in military vehicles (see figure 4-2).

Because of the highly specialized nature of most

operations energy uses (e.g., military mobility),

examination of opportunities for energy and cost

savings are largely beyond the scope of this report,

with the exception of the fuel used in passenger

vehicles and trucks. Specialized operations have

also received far less detailed attention in Federal

energy management legislation and Executive orders than energy use in buildings and vehicle fleets.

However, there are energy saving opportunities, at

least some of which are being tapped. For example,

DOE completed a number of process retrofits

including the installation of variable air volume

control on fume hoods and makeup air systems at the

Lawrence Livermore National Laboratory. DOE is

planning more efficiency measures involving use of

waste heat, advanced control systems, and scheduling of equipment.2 There are also measures which,

Figure 4-l—General Operations Costs, Fiscal Year 1989

Vehicles and equipment

$ billions

4 -

3 -

2-

1-

Defense Civilian

Energy source

- Auto gas = Diesel = LPG

~ Aviation gas m Jet fuel = Other

Process and production

300 $ millions

I ,

250

200

150

100

50

0

~,////,,,////,/

4

Defense

I

Civilian

Energy source

~ Electricity Fuel oil = LPG

= Natural gas ~ Coal = Other

SOURCE: U.S. Department of Energy, Federal Energy Management Program, “Annual Report to Congress on Federal Government Energy Management and

Conservation Programs,” October 1990.

Iu.s. Dep~ment of Energy, Federal Energy Management Program, “Annual Report to Congress on Federal Government Energy Management and

Conservation Programs,” October 1990, p. 5.

%id., p. 49.

–59–
60 ● Energy Efficiency in the Federal Government: Government by Good Example?

Figure 4-2-Operations Energy Use by Fuel,

Fiscal Year 1989

Trillion Btus

1,000 E

Petroleum Nonpetroleum

Fuel

n Jet fuel = l)Diesel/dist. fuel _ Auto gas

~ Other m Nonpetroleum

petroleum

NOTE: Source accounting used for electricity.

SOURCE: U.S. Department of Energy, Federal Energy Management

Program, *’Annual Report to Congress on Federal Government

Energy Management and Conservation Programs,” October

1990.

although not performed primarily to save energy, do

reduce energy use even for military mobility. For

example, many flight simulators are in use by DOD.

They supplement actual flying time and allow for

improved pilot training with greater safety and lower

cost. Part of the cost savings results from greatly

reduced fuel consumption (e.g., fighter aircraft can

consume more than 1,000 gallons per hour). Similarly, there are simulators for surface vehicles such

as tanks. Although the use of simulators increases

the use of electricity, this is more than offset by the

reduction in fuel consumption.

PASSENGER VEHICLES

AND TRUCKS

In total the Federal Government owned 106,108

sedans, 15,973 station wagons, and 323,479 light

trucks in 1988. In addition, there were 12,641 buses

and ambulances and 55,481 medium and heavy trucks.

DOD and the U.S. Postal Service (USPS) have the

largest fleets, each with about 30 percent of the total.

The General Services Administration (GSA), which

has oversight responsibility over federally owned

and leased passenger vehicles, has about 20 percent

of the total which it leases to other agencies.3 Almost

all Federal agencies own at least one vehicle and

may lease many others from the GSA Federal Fleet

Management System (figure 4-3).

The number of federally owned passenger vehicles and trucks is a very small percentage of the total

in the United States, about one-quarter of 1 percent.

As of 1988 there were 140 million automobiles and

43 million trucks and buses registered in the United

States. 4 Despite the small number of federally

owned vehicles, Federal procurement is responsible

for nearly 1 percent of domestically produced

vehicles. There are two reasons. First, agencies keep

their automobiles and light trucks for only 3 to 6

years before replacement.5 Thus each year, the

government purchases around 100,000 cars and light

trucks. (About 50,000 of these are procured by

GSA.) Second, the Federal Government historically

has purchased only domestic models for use in the

United States.

In fiscal year 1989, the Federal fleet, including

medium and heavy trucks, consumed over 329

million gallons of gasoline at a cost of $309 million.6

In 1988, the domestic fleet covered more than 3.5

billion miles, and the average Federal sedan traveled

13,027 miles.7

Increasingly the Federal auto fleet is relying on

compacts. In 1988 compacts outnumbered other

classes of sedans by almost two to one. The shift in

the makeup of the Federal fleet to smaller, more fuel

efficient cars has resulted in higher fleet average fuel

mileage. With few exceptions, the Federal automotive fleet uses conventional petroleum fuels (i.e.,

gasoline and diesel fuel), although there are some

alternate fuel vehicles.

Three promising ways to reduce the Federal

Government’s passenger vehicle energy use are:

1) purchase automobiles with higher fuel economy,

2) encourage drivers to drive more efficiently, and

3u.s. General Services Administration Office of Fleet Management, ‘‘Federal Motor Vehicle Fleet Report for Fiscal Year 1988,” September 1990,

table 7.

4u.s. Bmeau of the census, Statistical Abstract of the United States; 1990, 1 loth ed. (Washington w: 1990, tables 1W8 ~d 1029.

5Sea ~eu Director, GSA Fl=t M~geme~t Divisio~ person~ comm~~tioq NOV. 14, 1990; md Larry Frisbee, GSA Fleet hhllllgement

Divisio~ personal communicatio~ Jan. 10, 1991.

Gu.s. Department of Energy, op. cit., foo~ote 1, p. 53.

7u.s. Gener~ Services Administration, Oft3ce of Fleet Mamgement, ‘‘Federal Motor Vehicle Fleet Report for Fiscal Year 1988,” September 1990,

tables 6 and 12. These figures account for only large domestic fleets, which makeup 91.7 percent of total fleet.
Chapter 4--Federal Energy Use in General Operations ● 61

Figure 4-3-Federal Fleet Data, Fiscal Year 1988

Number of vehicles

120

100

80 1 I

DOD USPS GSA

Agency

Type of vehicle

Fuel consumption

Million gallons

‘

o o

~

DOD USPS GSA

Agency

Type of vehicle

trucks

Vehicle miles traveled

Miles (millions)

~:::: ~

- r l

800

600

400

200

0

DOD USPS GSA

Agency

Type of vehicle

SOURCE: U.S. General Services Administration, Office of Fleet Management, “Federal Motor Vehicle Fleet Report for FY 1988,” September 1990.

3) reduce the number of work-related trips, for with the Federal Government’s owned and leased

example, through increased use of teleconferencing. facilities, there appears to have been no coordinated

All three are being pursued currently by the Federal governmentwide effort to identify the potential for

Government, although it appears that additional further energy and cost savings in Federal light-duty

efforts could produce further energy and cost sav- vehicle fleet use beyond that required by the Motor

ings without sacrificing productivity. In addition, Vehicle Information and Cost Savings Act and

use of electric vehicles and alternate fuels such as Executive orders.

methanol and natural gas can be a way to decrease

Federal consumption of petroleum products.8 Al- Automobile Fuel Economy9

though not inherently an energy conservation meas- The variety of vehicles available in today’s

ure, use of alternate fuels could potentially reduce market is great. With hundreds of vehicles to choose

dependence on imported petroleum. As in the case from, fuel economy is only one of many distinguish8See us, con=e~~, Offlc- of Tec~olo= A~~e.~men~ Replacing Ga~o[ine: Alternative Fuels for Light-Du~ Vehicles, OTA-E-3M (wZtSbgtO~

DC: U.S. Government Printing Office, September 1990).

%or a discussion of prospects for increased fuel economy of automobiles generally, see Steve PlotkiQ “Improving the Fuel Economy of the U.S.

Automobile Flee~’ Testimony before the Subcommittee on Energy and Power, Committee on Energy and Commerce, U.S. House of Representatives,

Oct. 1, 1990.
62 ● Energy Efficiency in the Federal Government: Government by Good Example?

ing characteristics. The automobile with the highest

rated estimated mileage by the Environmental Protection Agency (EPA) gets 55 combined miles per

gallon (mpg). In any class, estimated mileage varies

considerably. For compacts, the highest in the class

rates an EPA estimate of 40 mpg; the lowest rates

15.5 combined mpg. In midsize cars, two models

received 28 combined mpg, while several others

received under 12 combined mpg.10

GSA is responsible for managing the Federal fleet

and assuring that it is in compliance with Executive

Order 12375, which requires the Federal passenger

fleet to attain the Corporate Average Fuel Economy

(which is 27.5 mpg for cars) and light trucks to attain

20.5 mpg from 1990 on as specified by the Secretary

of Transportation (see ch. 2). Currently, the Federal

automobile fleet has an average EPA mileage rating

of 29.4 mpg (combined city and highway), 7 percent

higher than the minimum requirement.11

The shift in the makeup of the Federal fleet to

smaller, more fuel efficient cars has been one

approach to securing a higher fleet average. The

code of Federal regulations includes a mandatory

provision stating that “all motor vehicles acquired

for official purposes by executive agencies shall be

selected to achieve maximum fuel efficiency and

limited to the minimum body size, and optional

equipment necessary to meet agencies’ requirements. 12

Further increases in economy of the Federal fleet

appear possible. For example, GSA’s Automotive

Commodity Center has contracted to purchase

13,000 passenger sedans in 1991 with EPAestimated mileage of 26 combined mpg, all with

automatic transmission.l3 Other vehicles in the same

class have better mileage ratings, including four

domestically produced models which get 27 mpg

with an automatic transmission. The manual transmission versions get 28 mpg.14 However, performance, safety, first cost, and resale value all differ

between the models, and must be considered in any

assessment of life-cycle costs.

Although sedans with manual transmissions have

about 4 percent higher fuel economy, sedans in the

Federal fleet use automatic transmissions. An effort

by GSA to promote manual transmission models

resulted in excessive vehicle repairs, primarily to

clutches. 15 This is not surprising since many drivers

of the Federal fleet are used to automatic transmissions in their own cars.

Maintenance and Driver Training

How an individual drives a vehicle can impact on

the mileage that vehicle achieves. Operator training

brochures and courses are offered by the Federal

Government that encourage better driving habits,

although results of these efforts are difficult to

measure. Recommendations include steps like: avoid

unnecessary idling, anticipate stops, avoid “jack

rabbit’ starts, and avoid speeds over 55 mph.16 Each

of these steps raises drivers’ awareness to fuel

efficient operation of their vehicles.

Regular maintenance can also affect the efficiency and operation of the vehicle. Examples of

items that can affect fuel economy are dragging

brakes, low transmission fluid levels, out-of-tune

engine, poor tire pressure, and old, plugged fuel or

air filters. Fleet maintenance programs in the Federal

Government are intended to meet manufacturer

standards, and GSA has had a computerized system

to track and encourage preventive maintenance since

1985.

Teleconferencing

Many Federal employees travel regularly and

extensively for meetings. Teleconferencing offers

the opportunity to have meetings without the time

and expense of traveling. Though it is only appropriate in certain circumstances, teleconferencing offers

real possibilities for many of today’s meetings in the

Federal Government. There are both energy and

lou.s. Environment protection Agency, ‘‘1991 Fuel Economy Guide, ” Sept. 2% 1990.

IIu.s. Gene~ Services Administration Automotive Commodity Center, “ 1991 Federal Standards for Automobiles, Light Trucks, and Medium

Trucks,” October 1990, p. iv.

1241 ~ IOI.N.1O1-2 (July 1, 1990 Ed.).

13Larry Frisbee, GSA Fleet Management Division, personal commurdcatio~ Jan. 10 and Jan. 31, 1991.

MU.S. Environmen~ Protection Agency, op. cit., footnote 10.

15Larry Frisbee, GSA Fleet Management Division, personal communicatio~ Jan. 31, 1991.

16u.s. Env~onmen~l fiotection Agency, “Tips for Fuel Efficient Driving, ” October 19$)(), p. 1.
Chapter 4--Federal Energy Use in General Operations ● 63

Photo credit: VideoTelecom Corp.

Video-teleconferencing is increasingly being used as an

alternative to travel, saving employee time,

travel expenses, and energy.

nonenergy benefits. In fact, energy savings may be

only a Ii-action of the value of time saved by Federal

employees through teleconferencing. Teleconferencing can reduce not only Federal fleet use, but also

the Federal use of air travel.

In 1985 GSA issued a “Federal Information

Resources Management Regulation Bulletin on

Travel by Federal Telecommunications System,”

stating:

Travel is expensive in terms of time, energy, and

money. This bulletin briefly describes telecommunications services provided by the Federal Telecommunications System (FTS) that can be used instead

of travel to promote and encourage governmentwide

savings. 1 7

The most advanced systems combine video-teleconferencing, which allows face to face meetings,

with data networks that allow transfer of documents

during a meeting. In the past 18 months, significant

strides have been made in making videoteleconferencing high-quality and cost-effective,

because of anticipated international standards and a

continuing steep downward cost curve.18

Some Federal agencies, including the National

Aeronautics and Space Administration and DOD,

currently have their own video-teleconferencing

systems in place, and GSA offers video-teleconferencing for lease to all agencies through its Federal

Telecommunications Service.19 These systems are

gaining use in the Federal Government (see table

4-l). For example, EPA has a system linking its

headquarters in Washington, DC with its office in

Research Triangle, North Carolina. The system’s

cost was $150,000.20 GSA expects a continued drop

in system costs over the next 18 months. Based on

the successful results to date, EPA is expanding to an

additional eight regional office sites. USPS inaugurated a $10-million satellite system with over 73

locations in December 1990. The two-way network

was created to provide training and deliver messages

to thousands of managers and employees. Assistant

Postmaster General Elwood Mosley said, “This

allows us to get to a large segment of the postal

population quickly without bringing them to a

central location. It’s a very efficient, effective

method to get information out to the field. ”21 The

system is expected to pay for itself within 4 years.

The cost of operating a video-teleconferencing

system, once installed, depends on the price of

accessing the high-speed transmission lines required. This price has dropped from about $1,000 an

hour in the mid-1980s to about $15 an hour in

1990. 22

Alternative Fuels and Vehicle Design

Several experimental programs with alternative

fuel vehicles are underway. The USPS has a growing

number of compressed natural gas trucks, in addition

to 67,000 fuel efficient long-life vehicles and over

6,000 diesel delivery vans. DOE and GSA are

purchasing a small number of alcohol fuel-flexible

vehicles and natural-gas-powered light trucks as

required by the Alternative Motor Fuels Act.23 The

Interagency Fleet Management System is currently

ITFr~J. Carr, Assist~t Adrninis~torfor Information Resources Management U.S. General ServiWs Atis@atiou FLRMRBulletin 16, ‘Travel

by Federal Telecommunications System,” Jan. 28, 1985.

18Matt Kramer, “Teleconferencing: Meeting the 1990’s Head-o~” PC Week, Apr. 9, 1990, vol. 7, No. 14, p. 57(l).

lsJoti Delu~@ U.S. General Semices Adrninistratio~ persomd communication NOV. 28, 1990.

2%.A. Wsud, “EPA Offices To Cross Distances With Trial of Videoteleconferencing, ’ Government Computer News, Nov. 27, 1989, vol. 8, No.

24, p. 3(l).

21Mark Kodama, “T raining via Television: Satellite System Gets the Word OU4° Federal Times, Dec. 31, 1990, p. 13.

zzpa~ B. CaITOll, “VideoPhones: Picture Looks Brighter at hs~” Wall Street Journal, Aug. 13, 1990, p. 1.

~Lfida G. Stuntz, Deputy Undersecretary for policy, “Statement on H.R. 5521-–The National Energy Policy Act of 1990,” Sept. 13, 1990, p. 2.
64 Energy Efficiency in the Federal Government: Government by Good Example?

Photo credit: Grumman Corp.

One of the U.S. Postal Service’s growing fleet of

long-life vehicles.

operating 25 methanol flexible fuel sedans with an

additional 40 such vehicles to be placed in service in

the near future. In addition, a procurement is

underway for light trucks fueled by compressed

natural gas. DOE’s Alternative Fuels Utilization

Program has had a Methanol Fleet Project underway

since 1985. An interim report found that energy

efficiency in the methanol vehicles is slightly greater

Table 4-l—Partial List of Agency

Teleconferencing Facilities

Type of

Agency Sites network

National Oceanic and Atmospheric

Administration 1. . . . . . . . . . . . . . . . . . . . . 18

National Weather Service1 . . . . . . . . . . . . . NA

Secret Service1 . . . . . . . . . . . . . . . . . . . . . . . 10

US. Army1 . . . . . . . . . . . . . . . . . . . . . . . . . . . 100

U.S. Department of Agricultural . . . . . . . . . 300

US. Department of the Interior’ . . . . . . . . . 80

U.S. Environmental Protection Agency2 . . . 11

U.S. Postal Service3 . . . . . . . . . . . . . . . . . . . 73

Data

Data

Data video

Video

Data

Data

Video

Video

SOURCES: I Satellite Communications as reported by Datapro Research

Satellite Communications: Technology Briefing, MT20-620-

101 (Delran, NJ: McGraw Hill, Inc., 1989), pp. 2-3.

zJohn DeLuccha, U.S. General Services Administration, personal communication, Nov. 28, 1990.

aMark Kodama, “Training via Television: Satellite sySteM Get-s

the Word Out,” Federal Times, Dec. 31, 1990, p. 13.

than the counterpart gasoline vehicles, but the

alternative vehicles have required more service.24

Development of electric delivery vans by domestic

auto manufacturers, and improvements in electric

vehicle batteries are continuing with support from

the Electric Power Research Institute and may also

be of use in certain applications in the Federal

fleet. 25

~R.N. McGill and S.L. Hillis, Results From [he Second Year of Operation of the Federal Methanol Fleet at Lawrence Berkeley Laboratov,

ORNL~10815 (Oak Ridge, TN: Oak Ridge National Laboratory, August 1989).

~See Elec&ic power Research ~titite, Electric G-Van, EPRI EU.2019.5.89R (IWO Alto, CA: 1989); and Electric Power Research ktitUte, The

Chrysler Electric TEWan, EPRI EU.2022.1 1.90R (Palo Alto, CA: 1990).
Chapter 5

Six Case Studies
INTRODUCTION AND CASE

STUDY METHODOLOGY . . . . . . . . . . .

CONCLUSIONS: OPPORTUNITIES FOR

FURTHER ENERGY AND COST

Contents

Page

,. 67

SAVINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67

CASE STUDY 1: GSA, SUITLAND COMPLEX,

SUITLAND, MD . . . . . . . . . . . . . . . . . . . . . . . . . . 68

Current Energy Use ..,... . . . . . . . . . . . . . . . . . . . 68

Factors Affecting Energy Use . . . . . . . . . . . . . . . . . 68

Energy Conservation Efforts to Date . . . . . . . . . . . 68

Energy Conservation Potential . . . . . . . . . . . . . . . . . 69

Barriers to Energy Conservation . . . . . . . . . . . . . . 71

CASE STUDY 2: VA MEDICAL

CENTER, WASHINGTON, DC . . . . . . . . . . . . . 72

Current Energy Use . . . . . . . . . . . . . . . . . . . . . . . . . . 72

Factors Affecting Energy Use . . . . . . . . . . . . . . . . . 72

Energy Conservation Efforts to Date . . . . . . . . . . . 73

Energy Conservation Potential .. .. ... . . . . . . . . 73

Barriers to Energy Conservation .,...... . . . . . . . 73

CASE STUDY 3: SANDIEGO DIVISION OF

THE U.S. POSTAL SERVICE, CA . . . . . . . . . . 75

Current Energy Use . . . . . . . . . . . . . . . . . . . . . . . . . . 75

Factors Affecting Energy Use, . . . . . . . . . . . . . . . . 76

Energy Conservation Efforts to Date . . . . . . . . . . . 76

Energy Conservation Potential .. .. ... .. . . . . . . . 77

Barriers to Energy Conservation . . . . . ... ..... 79

CASE STUDY 4: FORT BELVOIR ARMY

BASE, VA ..... . . . . . . . . . . . . . . . . . . . . . . . . . 79

Current Energy Use . . . . . . . . . . . . . . . . . . . . . . . . . . 79

Factors Affecting Energy Use . . . . . . . . . . . . . . . . . 79

Energy Conservation Effects to Date.... . . . . . . 79

Energy ConservationPotential . . . . . . . . . . . . . . . . . 80

Barriers to Energy Conservation . . . . . . . . . . . . . . . 80

CASE STUDY5: GSA-LEASED OFFICE

BUILDING, WASHINGTON, DC . . . . . . . . . . . 82

Current Energy Use .. .. +. . . . . . . . . . . . . . . . . . . . . 82

Factors Affecting Energy Use....,,.....,., 82

Energy Conservation Efforts to Date.......,., 82

Energy Conservation Potential . . . . . . . . . . . . . . . . . 82

Barriers to Energy Conservation . . . . . . . . . . . . . . . 84

Page

CASE STUDY6:RICHMOND

REDEVELOPMENT AND HOUSING

AUTHORITY, RICHMOND, VA . . . . . . . . . . . . 84

Current Energy Use . . . . . . . . . . . . . . . . . . . . . . . . . . 84

Factors Affecting Energy Use . . . . . . . . . . . . . . . . . 85

Energy Conservation Efforts to late ... ,.. .,.,. 85

Energy Conservation Potential . . . . . . . . . . . . . . . . . 85

Barriers to Energy Conservation .,.... . . . . . . . . . 86

Figures

Figure Page

5-1. Suitland Complex Energy Data. . . . . . . . . . . . . . . 69

5-2. Energy Consumption at USPS San Diego

Division, Fiscal Years 1985, 1987, and 1990... 76

5-3. Fort Belvoir Energy Consumption and Cost,

Fiscal Years 1980-90 . . . . . . . . . . . . . . . . . . . . . . . . 80

5-4. Richmond RHA Annual Energy Consumption

for Selected Years . . . . . . . .,,.... ...... . . . 85

Tables

Table Page

5-1. Information Collected From Case Study Sites. 67

5-2. Conservation Measures Implemented -

to Data at Suitland Complex . . . . . . . . . . . . . . . . 70

5-3. U.S. Department of Veterans Affairs

Medical Center Energy Consumption,

July 1989 to July 1990. . . . . . . . . ... ... ......73

5-4. Conservation Measures Implemented

to Date at VA Medical Center . . . . . . . . . . . . . . . 74

5-5. Conservation Measures Implemented at

U.S. Postal Service, San Diego Division . . . . . 77

5-6. Summary of South County Lighting

Retrofit Potential ,,..., . . . . . . . . ..,.,.. ,. 78

5-7. Spring Valley Post Office Lighting

Retrofit Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . 79

5-8. Measures Partially or Fully Implemented

to Date at Fort Belvoir . . . . . . . . . . . . . . . . . . . . . 81

5-9. Energy Conservation Measures Implemented

at GSA Leased Building . . . . . . . . . . . . . . . . . . . . 83

5-10. Energy Conservation Measures Implemented

to Date at Richmond Redevelopment

Housing Authority . . . . . . . . . . . . . . . . . . . . . . . . . 86
Chapter 5

Six Case Studies

INTRODUCTION AND

CASE STUDY METHODOLOGY

As part of its examination of opportunities for

increased energy efficiency in the Federal Government, OTA conducted case studies of six diverse

facilities. 1 Four are government owned and occupied, the fifth is a privately owned building leased to

the Federal Government, and the last is a federally

assisted housing authority.

Each case study examin ed two main topics: 1)

current energy use and the opportunities for increased efficiency; and 2) the institutional, budgetw, economic, and technical reasons why apparently

attractive energy conservation options were not

being pursued.

The methodology used in the case studies relied

heavily on the experiences of facility managers and

any available facility energy analyses that had

already been performed. OTA contracted with EnviroManagement & Research, Inc. (EMR), a consulting

engineering firm, to conduct the case studies. Each

case study included both on-site visits and telephone

and mail correspondence. Table 5-1 lists the type of

information and data collected.

EMR reviewed and analyzed all information

collected on each case study facility. Only commercially proven and very highly cost-effective measures having a payback period of less than 3 years

were considered.2 Also, only more efficient equipment or improved operations and maintenance

practices were considered. Approaches which require change in occupant comfort or productivity

were not considered. Efficiency measures were

divided into three categories: no cost, low cost, and

significant cost. No cost measures involve virtually

no cost to the facility as they can be implemented by

in-house personnel. Low cost measures likewise can

be implemented for the most part by in-house

personnel, but necessitate some expenditures for

materials and equipment required for the retrofit.

CONCLUSIONS:

OPPORTUNITIES FOR FURTHER

ENERGY AND COST SAVINGS

Three main conclusions are true of all of the case

studies. First, there appears to be a large potential for

savings. At these six federally owned, leased, or

assisted facilities, an average savings of over 25

percent in annual operating cost and energy use

appears achievable with proven and highly costeffective technologies and operating strategies according to facility personnel. OTA’s sample was

small and not necessarily representative of the

opportunities available in the overall Federal Government. However, it should be noted that two of

OTA’s case study subjects are Federal Energy

Efficiency award winners. That is, these facilities

and their personnel have made considerable, noteTable 5-l —lnformation Collected From

Case Study Sites

●

●

●

●

●

●

●

●

●

●

●

●

General description of existing facilities, systems, and equipment

Current energy use by type of fuel and major end-uses

Major trends affecting energy use (e.g., increasing use of

personal computers in offices; use of energy-intensive medical

equipment such as computerized tomography scanners in

hospitals; change in facility’s mission; higher occupant density

in offices)

Major operational or equipment changes undertaken since

1980 to increase energy efficiency

Planned modifications to building systems and equipment

Experience with implementation of energy efficient technologies

Energy and cost savings achieved due to implementation of

energy conservation measures

Impediments (institutional, budgetary, economic, and technical) affecting implementation of energy conservation efforts

Perceived incentives for energy conservation

Priority given to energy conservation in agency’s mission

Technical and economic criteria used for assessing energy

conservation options

Estimates of time it takes from initial study to final implementation of energy conservation options -

SOURCE: EMR, “Case Study of Federal Building Energy Use,” contractor

report prepared for the Office of Technology Assessment,

December 1990.

1TM5 Ctipter is a&p@d from Enviro-Management & RtXS~CIL kc., ‘‘Case Study of Federal Building Energy Use,” contractor report prepared for

the OffIce of Technology Assessment December 1990.

%ecause so many energy efficiency opportunities in the Federal Government are currently untapped, this study focuses only on those which are very

highly cost-effective. However, it does not intend to suggest that a very bigh discount rate is appropriate in analyzing Federal energy eftlciency

opportunities. See ch. 1, box l-A.

--67-
68 ● Energy Efficiency in the Federal Government: Government by Good Example?

worthy achievements in energy efficiency not generally found throughout the government. Thus, it is

reasonable to believe that greater savings are possible than indicated by this limited sample. Again,

note that the case study estimates included only

extremely cost-effective options in which the capital

costs and other costs of implementation are small

compared to the savings, with simple paybacks of

under 3 years. A less stringent economic test that is

more consistent with the cost of capital in the United

States would produce higher estimates of potential

energy and cost saving.

Second, there remains considerable uncertainty

about the true extent of efficiency opportunities at

the case studies. None of the facilities had performed

a detailed energy audit of all their systems and

operations within the past decade. Documentation

and inventories for building systems and equipment

and related energy conservation options were also

often lacking. As a result, detailed, independent

analysis of financial and economic characteristics of

major options could generally not be performed.

Ideally, analysis would include a review of financial,

economic, and performance characteristics (e.g.,

capital costs, operating savings, performance improvements, return on investment (ROI) or payback)

for all major options. Instead, the applicability and

economic performance of various options were

estimated based on the professional judgment of the

facility managers and EMR.

Third, there is a variety of constraints to improved

energy efficiency at the facilities. Funding or staffing constraints are common and important, but low

priority, lack of incentives, and other factors are also

noted by facility personnel.

CASE STUDY 1:

GSA, SUITLAND COMPLEX,

SUITLAND, MD

General Services Administration’s (GSA) Suitland Complex comprises five major buildings occupied by the National Archives and Records Administration, Naval Intelligence, Census Bureau, and

National Oceanic and Atmospheric Administration.

The total building area in the Complex is approximately 2 million square feet.

Current Energy Use

The total annual energy expenditures are about

$5 million. Several different energy sources are used

in the Complex, including electricity, natural gas,

and oil. Electricity is the dominant form, accounting

for over 90 percent of expenditures. It is used for

lighting, comfort conditioning, computer room airconditioning, and electrical equipment. Natural gas

and oil are used for space heating, service water

heating, and cooking.

Energy consumption and cost data for the Complex since 1985 are shown in figure 5-1. Electricity

consumption has increased by about 26 percent

since 1985 due to a variety of factors as discussed

below. Natural gas consumption has decreased by

more than 50 percent, reflecting the effects of

changing weather conditions, energy conservation

efforts, and cutback of gas supplies because of

participation in a curtailable service program. With

regards to the latter, oil consumption, which is very

low, has fluctuated because all heating equipment

used oil during periods of natural gas curtailment.

Factors Affecting Energy Use

Several changes causing greater energy use are

occurring at the Complex:

●

●

●

●

●

More people are working at the Complex. In the

past, space allocation was 200 square feet per

person. It now is down to 135 square feet per

person, and the new goal is 122 square feet per

person.

More computer equipment is being used in

computer rooms and offices.

Office and storage space has been converted to

computer rooms.

Network computers are always left on because

of the growing use of electronic mail.

More building space is being added to the

Complex. A 17,000-square-foot addition was

built for the NIC 2 Building and a 5,000-squarefoot conference center will be completed in

1991. The master plan calls for approximately

1 million square feet of additional space at the

Complex.

Energy Conservation Efforts to Date

Many energy efficiency improvements have been

implemented at the Complex since 1980 because of

personal interest taken by field office personnel.

Most of these improvements involved no cost/low
Chapter S-Six Case Studies ● 69

Figure 5-1-Suitland Complex Energy Data

Electricity Natural gas

$ thousands MWh (thousands)

5,00 0

4,000

3,000

2,000

1,000

0

1985 1987 1988 1989 1990

Fiscal year

ZZZZ Cost EZZ Consumption

Oil

80

60

40

20

0

8 0$ thousands Gallons (thousands)

I 160

1

140

120

100

80

60

40

20

0

1985 1987 1988 1989 1990 -

Fiscal year

EZ!ZZ Cost IZZ Consumption

600

500

400

300

200

100

0

$ thousands Million cubic feet ~ AA

1 1 Z(J

80

60

40

20

0

1985 1987 1988 1989 1990

Fiscal year

IZZZ Cost EZZZ2 Consumption

Aggregate cost

5000 $ thousands

s

4,000

3,000

2,000

1,000

0

1985 1987 1988 1989 1990

Fiscal year

= Electricity = Natural gas m Oil

SOURCE: EMR, “Case Study of Federal Building Energy Use,” contractor report prepared for OTA, December 1990.

cost options because funding for capital-intensive

projects was not readily available. Energy conservation was given low priority, while more attention

was focused on other concerns such as asbestos

removal, fire safety, health issues, and transformers

containing polychlorinated biphenyls (PCBs). Since

1987, however, emphasis on energy conservation

has increased substantially due to the new programs

initiated by the chief of the energy management

section at the National Capital Region (NCR) office

and commitment of personnel at the field office. The

field office manager is enthusiastic and thorough in

finding and trying new energy- and cost-saving

measures, and received a Federal Energy Efficiency

Award in 1990.

Many measures are actively being considered or

currently being implemented (see table 5-2) at the

Complex due to joint efforts between the NCR and

the field staff. Furthermore, GSA has created a

special energy management fund for implementing

energy conservation projects. Currently, $30 million

has been allocated for fiscal year 1991, one-third of

which will be spent on lighting energy conservation

retrofits in the NCR.

Energy Conservation Potential

Many cost-effective energy conservation measures have yet to be implemented at the Complex.

Thus, a significant potential for further energy

conservation still exists. The field office manager

estimated that up to 20-percent reduction in energy

use can be achieved if the following measures were

implemented:

. Replace existing ballasts with higher efficiency

electronic ballasts.
70 ● Energy Efficiency in the Federal Government: Government by Good Example?

Table 5-2-Conservation Measures Implemented to Date at Suitland Complex

Increase efficiency of heating, ventilating, and

air-conditioning systems

Maintain systems for efficiency:

Adjusted air dampers for tight closing.

Adjusted fuel-air ratio, fuel temperature at burner tip.

Sealed air leaks into combustion chamber.

Adjusted pumps to control leakage at pump packing glands.

Checked flues and chimney for blockages or improper draft

conditions.

Clean f ilters and heat transfer surfaces.

Clean strainer screens in pumping systems.

Keep maintenance and operating log of all heating equipment.

Maintain correct refrigerant charge to avoid excessive

compressor operation.

Recalibrated all controls.

Repair faulty steam traps and valves.

Repair leaks in chilled water, condenser water and conditioned air

distribution systems.

Repaired insulation on economizers, condensate receiver tanks,

boilers, furnaces, etc.

Use proper water treatment to reduce fouling of heat transfer

surfaces in boilers, heat exchangers, etc.

Operate systems efficiently:

Do not permit perimeter and interior systems to buck one another.

Eliminate or reduce use of HVAC systems which require

simultaneous heating and cooling.

Operate only necessary heating water pumps.

Operate only the chilled water pump and cooling tower fans as

necessary.

Operate return-air fans for heating during unoccupied hours.

Optimize ventilation startup times.

Vary temperature of supply air, heating water and ohilled water,

and pressure of steam in accordance with load.

Recover heat from condensate.

Reduce generating and storage temperature levels to the

minimum required.

Use outdoor air for economizer cooling.

Use spot cooling of people when they were located far apart.

Use minimum number of chillers and boilers. (More efficient to

operate one unit at 90% than two at 45%.)

Use lowest possible radiation temperature in perimeter spaces.

Lower indoor temperature and relative humidity during heating

season as practical.

Operate ventilation and exhaust systems only when needed (e.g.,

at a minimum during unoccupied hours).

Turn off cooling system during unoccupied hours in noncritical

areas.

Reduce cooling/heating in over-cooled/-heated spaces.

Locked thermostats to prevent resetting by unauthorized

personnel.

Upgraded equipment to allow efficient operation;

Added valves, dampers and controls to set back temperatures

during unoccupied periods in noncritical areas.

Added automatic draft damper control to reduce heat loss through

breaching when the gas or oil burner in not in operation,

installed automatic ventilation controls.

installed warmup cycle controls on air handling units with outside

air intake as applicable.

installed time clocks on self-contained cooling units for automatic

shutoff.

installed automatic temperature control valves in radiators

controlled by hand valves.

insulated steam lines, above and below ground.

insulated chilled water piping and ductwork carrying conditioned

air through unconditioned spaces.

Provided additional thermostats for better control of heating

equipment.

Replaced inefficient window air conditioners.

isolated off-line chillers and boilers.

installed boiler stack economizer for preheating feed water.b

Recirculated exhaust air using activated charcoal filters in

noncritical areas.b

Replaced existing boilers which are not at or near the end of their

useful life with modular boilers. b

improve the building envelope

Added additional insulation to roofs, ceilings and floors over

unconditioned areas.

Added reflective films to reduce solar heat gain.

Established rules for all building personnel to keep doors and

windows closed when heating or cooling system is operating.

installed weatherstripping around windows and doors.

installed an air curtain at loading dock.

installed automatic door closers on exterior doors.

Rehung misaligned exterior doors.

Replaced broken windows.

Used opaque or translucent insulating materiais to blockoff and

thermally seal all unused windows.

Used vestibules and/or revolving doors to reduce infiltration. b

Improve lighting efficiency:

Reduce unneeded illumination:

installed photocell or time controls to operate outdoor lighting.

installed occupancy sensors in hallways and other areas.

installed timers to control lights in closets.

Reduced illumination to levels consistent with productivity, safety

and security considerations.

Removed unnecessary lamps when those remaining can provide

desired illumination.

Relocated luminaires to provide light on task areas.

Use daylighting for illumination in perimeter areas as practical.

Increase efficiency of lamps, ballasts and fixtures:

Used more efficient ballasts.

Use light colors for walls, floors and ceilings to increase

reflectance but avoid specular reflections.

Use high-efficiency fixtures.

Clean lamps, luminaires and interior surfaces.

lowered height of lighting fixtures.

Used higher efficiency lamps.b

Miscellaneous

Boost hot water temperature locally.

De-energized booster heaters in kitchens at night.

De-energized hot water circuiting pumps when building is

unoccupied.

Examined elevator usage; shut down excess capacity.

improved maintenance of motors.

installed and maintained insulation on all hot water pipes, fittings

and valves passing through unconditioned spaces.

insulated hot bare pipes and storage tanks.

installed efficient nozzles and faucets.

Located water heater close to point of use.

Turned off infrared food warmers when no food is being warmed.

alJnless otherwise noted, al{ measures are considered by facility personnel to be IOW cost Orno cost.

bsignificant co5t measure as identified by facility personnel.

SOURCE: Adapted from Enviro-Management & Research, “Case Study of Federal Building Energy Use,” contractor report prepared for the Off”ce of

Technology Assessmentr December 1990.
Chapter 5--Six Case Studies ● 71

●

●

●

●

●

●

●

Replace the existing energy management system with anew system employing direct digital

controls. Include optimizing functions on all air

handling units and chillers.

Convert constant air volume systems to variable air volume systems. In conventional buildings employing constant air volume systems,

the quantity of air heated or cooled remains the

same regardless of the heating or cooling

requirements of the area or zone served. The

energy waste which results can be almost

eliminated by converting to variable air volume

systems fitted with adjustable speed fan controls which throttle down conditioned air supply to each area or zone to meet the changing

load requirements.

Replace oversized motors with energy efficient

motors. Most motors are oversized for the

equipment loads served. The degree of oversizing increases when building loads are reduced through application of various energy

conservation opportunities. Motors that are not

loaded to at least 60 percent of their potential

are inefficient. They should be replaced with

energy efficient motors, which are about 8

percent more efficient than the models in use at

the facility.

Use variable speed pumping. The design of

chilled water pumps requires that sufficient

capacity be installed for ‘‘design’ cooling

load. However, ‘‘design’ load conditions exist

only a small percentage of the time, whereas a

reduced load and reduced pumping capacity

exist most of the time.

Eliminate all unnecessary exhaust hoods and

roof ventilators. The air which is exhausted

must be made up by outside air which usually

is conditioned. This creates significant energy

waste. Correcting the problem can create substantial savings.

Reduce infiltration and exfiltration through

openings in building envelope. Both infiltration and exfiltration place a burden on the

heating and cooling systems, much as ventilation does. When conditioned air leaks out, it is

made up of indoor air which must be conditioned. When outdoor air leaks in, it must be

conditioned, too.

Install economizer cycle controls. The savings

provided by an economizer cycle can range

from 10 to 60 percent of current cooling energy

costs, depending upon the type of building and

heating, ventilating, and air conditioning (HVAC)

system involved.

Balance chilled water and air distribution

systems. Balancing assures that only the proper

amounts of conditioned water or air are supplied to each zone. This minimizes energy used

by the cooling system while simultaneously

providing greater comfort.

Reglaze windows with double or triple glazing.

Double- or triple-glazed windows can reduce

heat transfer by more than 50 percent, thus

significantly lowering heating and cooling load

which the HVAC system must meet.

Reduce thermal losses and eliminate leaks in

underground hot water and chilled water lines.

Leaks can cause substantial energy waste. The

value of such waste can be very large if left

uncorrected. The underground hot water distribution system at the Complex is about 25 years

old and needs repairing.

Install automated demand limiting controls.

Demand control can result in significant cost

reduction by reducing a facility’s electrical

demand during peak periods. New microprocessor-based systems permit energy reduction as

well because these systems can perform many

more functions (e.g., optimized start/stop, duty

cycling of motors, etc.) than just demand

control systems.

Reduce quantity of service hot water used.

Installing-flow reduction devices is one of the

most effective techniques for reducing consumption of hot water. These devices include

flow restricting orifices which are installed in

the line, aerators which reduce flows and mix

water with air, and self-closing hot water

faucets.

Barriers to Energy Conservation

Several barriers have restricted full implementation of energy conservation measures at the Complex in the past. Some of these still exist. They are

as follows:

●

●

Inadequate procurement and clerical staff to

implement energy conservation projects even

though funding currently is available. This also

limits the Complex in taking advantage of local

utility incentive and rebate programs.

Top agency management commitment to energy conservation has not been consistent. As

an example, it was not until 1987 that energy
72 ● Energy Efficiency in the Federal Government: Government by Good Example?

●

●

●

●

●

●

conservation gained greater acceptance and

commitment from top agency management. A

new chief of energy management was appointed at that time. Once on-board, the chief

aggressively promoted energy conservation

and initiated a range of new programs.

Procurement policies limit acquisition of highquality equipment, products, and services. According to the field office manager, ‘‘The

Federal Government’s policy of selecting small

businesses and/or the lowest bidder does not

necessarily result in quality equipment, products and services. ’

Economic criteria used by GSA limits implementation of certain technologies which can

result in significant energy savings but-have

long payback periods (more than 3 years).

Substantial lag time (3 to 5 years) in acquiring

and installing capital intensive equipment and

lack of follow-through. For example, it took 3

years to acquire an energy management system

and an additional 2 years to install. After

completion, the system never worked because

it was installed improperly.

Some new energy conservation technology is

too sophisticated for building operators to

understand and operate. As an example, the

lighting controls for certain outdoor lighting is

so sophisticated that most of the mechanics at

the Complex are unable to understand or

properly operate these devices.

Lack of funds for personnel training in energy

conservation. Although some funds are available, these have been allocated for training in

other areas, such as asbestos management and

removal.

Policies that restrict replacing equipment that is

still operating but is outdated and inefficient.

As an example, the Complex still employs

many motors that were installed in the 1950s.

Because they still are operating, no funds are

available for replacing them with energy efficient motors.

CASE STUDY 2:

VA MEDICAL CENTER,

WASHINGTON, DC

Built in 1962, the U.S. Department of Veterans

Affairs (VA) Medical Center currently comprises

870,000 square feet of hospital, nursing home,

research, and other medical care facilities.

Current Energy Use

A variety of energy sources are used at the VA

Medical Center with electricity comprising over 90

percent of spending. Electricity is used primarily for

space cooling, ventilation, lighting, cooking, and

other electrically driven equipment and machinery.

Other energy sources are used for the following

applications: fuel oil for emergency generators,

vehicles, and tractors; natural gas for cooking and

laboratory bunsen burners; gasoline for VA-owned

vehicles and equipment; and purchased steam for

space heating and service water heating. Energy

consumption data for the most recent 12 months is

shown in table 5-3.

Factors Affecting Energy Use

Many of the building systems used in the Center

are relatively inefficient by today’s standards (e.g.,

lighting systems designed to provide 150 footcandles in administrative areas, air handling systems

designed for 100 percent outside air even in administrative areas, and use of dual duct systems). This is

because several of the Center’s buildings were built

at a time when energy was relatively cheap and

energy conservation standards did not exist.

Although the Center has implemented a range of

energy conservation measures, the following new

situations have resulted in increased energy consumption for space conditioning, lighting, service

water heating, and other support equipment critical

to the mission of the Center:

●

●

●

●

●

●

Personal computers are being used increasingly

in administrative areas.

Energy-intensive medical equipment such as

nuclear magnetic resonance scanners is being

used increasingly for personal care and diagnostics.

Occupancy levels are the highest they have ever

been.

Patient care and administrative activities at the

Center have substantially increased in recent

years.

Construction of new facilities has added more

square footage to the Center. As examples,

Building 4 was added in 1973 and a nursing

home was built in 1985.

New mechanical and electrical equipment has

been added to the Center in support of new and

expanded facilities since 1973.
Chapter 5-Six Case Studies ● 73

Table 5-3—U.S. Department of Veterans Affairs

Medical Center Energy Consumption,

JUIy 1989 to July 1990

Energy source Energy consumption

Electricity . . . . . . . . . . . . . . . . 181,588,000 kWh

Fuel oil . . . . . . . . . . . . . . . . . . 7,933 gallons

Natural gas . . . . . . . . . . . . . . . 2,584,900 cubic feet

Gasoline . . . . . . . . . . . . . . . . . 8,475 gallons

Purchased steam . . . . . . . . . . 88,168,150 pounds

SOURCE: EMR, “Case Study of Federal Building Energy Use,” contractor

report prepared for the Office of Technology Assessment,

December 1990.

Energy Conservation Efforts to Date

The Center has implemented a variety of energy

conservation measures since the 1973 oil embargo

which dramatically increased the cost of energy.

Although the Center has no formal energy management program, it has implemented a range of energy

conservation measures to date as part of its continuing maintenance program. The funding for past and

ongoing energy conservation efforts has been derived from the nonrecurring maintenance budget.

Table 5-4 summarizes the various energy conservation measures that have been implemented to date.

Although some of the measures represent one-time

efforts (e.g., rehanging misaligned exterior doors

and providing additional thermostats for better

control of heating equipment), most measures are

being implemented on a continuing basis (e.g., shut

off exhaust systems when not needed and reset

heating water temperature in accordance with load).

Most of these are no cost/low cost measures.

Energy Conservation Potential

Although these energy conservation efforts have

resulted in some energy savings and reduced cost,

the potential for further energy and cost savings

remains high. Because the Center has to date

implemented mostly no cost/low cost measures, a

significant potential for further energy and cost

savings still exists. It is estimated by engineering

and operating personnel at the facility that up to a

30-percent reduction in energy use can be achieved

if the following measures are implemented:

. Reduce illumin ation in various spaces to levels

consistent with American Society of Heating,

Refrigerating, and Air-Conditioning Engineers

(ASHRAE) Standard 90 (e.g., reduce from 150

foot-candles to 75 foot-candles in administrative areas).

●

●

●

●

s

●

●

●

●

●

●

●

Replace all existing fluorescent lamps with

higher efficiency fluorescent lamps.

Replace existing ballasts with higher efficiency

electronic ballasts.

Replace incandescent lamps with compact

fluorescent lamps as appropriate.

Replace existing mercury vapor lamps with

high-pressure sodium lamps for exterior lighting.

Add controls (timers, motion detectors, dimmer

switches, daylighting controls, etc.) as appropriate to turn off lighting during noncritical

periods (e.g., 8 p.m. to 5 a.m.) in hallway

corridors and unoccupied areas.

Add controls to turn off all lighting in the

parking garage of the nursing home when not

needed.

Replace existing energy management system

with new system employing direct digital

controls. Include optimizing functions on all air

handling units and chillers.

Convert remaining constant air volume systems

to variable air volume systems.

Use adjustable speed drives for variable fan

speed control.

Replace all motors above 40 hp with energy

efficient motors.

Use variable speed pumping during light loads.

Use an active solar system for heating in the

swimming pool, which currently consumes

one-third of total purchased steam in the winter

and one-half of total purchased steam in the

summer.

Barriers to Energy Conservation

Despite the past energy conservation efforts at the

Center, many barriers and constraints still must be

overcome in order to achieve further energy and cost

savings. These are as follows:

. Relatively low priority is given to energy

conservation because energy expenditures constitute a very small percentage of the overall

Center budget. Medical care and safety and

health-related projects (e.g., asbestos and PCB

removal) are given a much higher priority.

Because of the nature of the Center’s mission,

patient care is accorded the highest priority.

According to the assistant chief of engineering,

“If a doctor needed a new piece of machinery

to do a scan, that machinery will be bought

before any engineering projects are even con292-861 91 - 4
74 ● Energy Efficiency in the Federal Government: Government by Good Example?

Table 5-4-Conservation Measures Implemented to Date at VA Medical Centera

Increase efficiency of heating, ventilating, and airconditioning systems

Maintain systems for efficiency:

Adjusted dampers in mixing boxes and multizone units to reduce

leakage.

Adjusted pumps to control leakage at pump packing glands.

Checked refrigeration systems for correct refrigerant charge to

avoid excessive compressor operation.

Clean filters, heat transfer surfaces and combustion surfaces.

Use proper water treatment to reduce fouling of transfer surfaces

in chillers, boilers and heat exchangers.

Corrected improper automatic control operation.

Keep maintenance and operating log of heating equipment.

Maintain all cooling equipment.

Repaired insulation and leaks on economizers, condensate

receiver tanks, boilers, furnaces, etc.

Sealed all air leaks into combustion chamber.

Use low resistance filters, registers and grilles to reduce

horsepower required for air movement.

Operate systems efficient/y:

Eliminate or reduce use of HVAC systems which require

simultaneous heating and cooling.

Use minimum number of chillers; isolate off-line units.

Iocked thermostats to prevent resetting by unauthorized

personnel.

Lower indoor temperature and relative humidity during heating

season.

Operate condenser water system at lower temperature.

Operate only the chilled water pump and cooling tower fans as

necessary.

Operate only necessary heating water pumps.

Recover heat from condensate.

Reduce generating and storage temperature levels to the

minimum required.

Reduce fan speed and hours of fan and pump operation.

Turn off cooling system and reduce ventilation rates during

unoccupied hours in noncritical areas.

Use lowest possible radiation temperature in perimeter spaces.

Use outdoor air for economizer cooling.

Use spot cooling of people when they were located far apart.

Vary temperature of heating water, chilled water and supply air,

and pressure of steam in accordance with load.

Close off unused areas and rooms.

Do not cool lobbies, passageways and storage areas to same

degree as work areas.

Increase indoor temperature and relative humidity levels during

cooling season as practical.

Reduce cooling in over-cooled spaces.

Upgraded equipment to allow efficient operation:

Added heat recovery on all computer room cooling units.

Added heat recovery roils on major exhaust systems.b

Added heat recovery coils on major dual duct air handling units. b

Added controls to setback temperatures during unoccupied

periods in noncritical areas.

Converted constant-volume fan system to variable air volume.

Eliminated unnecessary exhaust hoods and roof ventilators.

Installed economizer cycle.

Installed and maintain insulation on all hot water pipes, fittings and

valves passing through unconditioned spaces.

Installed valves and dampers to permit shutoff of heating in

unoccupied areas where there is no danger of freezing.

Installed energy management control system.b

Insulated all steam lines, above and below ground.

Insulated all duct work carrying conditioned air through

unconditioned spaces.

Insulated chilled water piping and ductwork located in

unconditioned spaces.

Insulated hot bare pipes and storage tanks.

Provided additional thermostats for better control of heating

equipment.

Replaced oversized hoods that removed excessive quantities of

air.

Improve the building envelope

Improve building envelope:

Caulked all windows and door frames.

Established rules for all building personnel to keep doors and

windows closed when heating system is operating.

Installed weatherstripping around windows and doors.

Installed loading dock door seals.

Installed automatic door closers on all exterior doors.

Reduced solar heat gain.

Reglazed windows with double glazing.

Rehung misaligned exterior doors.

Repaired cracks and openings in exterior surfaces.

Used vestibules and/or revolving doors to reduce infiltration.

Improve lighting efficiency:

Reduce unneeded illumination:

Added photocell or time controls to operate outdoor lighting.

Use light colors for walls, floors and ceilings to increase

reflectance but avoid specular reflections.

Reduced illumination to levels consistent with productivity, safety

and security considerations.

Removed unnecessary lamps when those remaining can provide

desired illumination.

Used daylighting for illumination in perimeter areas as practical.

Increase efficiency of lamps, ballasts and fixtures:

Clean lamps, Iuminaires and interior surfaces.

Miscellaneous

Adjusted valves for minimal water use.

Boost hot water temperature locally.

Checked sterilizer and refrigeration equipment for proper

gasketing and function. Repair or replac as necessary.

Inserted orifices in hot water pipes to reduce flow.

Installed efficient nozzles and faucets.

Installed demand limiting equipment.

Clean refrigeration condenser coils.

Recover steam condensate for service water heating.

Replaced sterilizers to reduce steam demand.

Replaced old steam cookers with new flask cookers.

Replaced selected motors with energy efficient motors.b

Turn off electrical appliances and machinery not being used.

Use water properly for grounds.

aUnIess otherwise noted, all measures are considered by facility personnel to be low cost or no cost.

bsignif~ant cost measure as identified by facility personnel. -

SOURCE: Adapted from Enviro-Management & Research, “Case Study of Federal Building Energy Use,” contractor report prepared for the Office of

Technology Assessment, December 1990.
Chapter 5-Six Case Studies . 75

●

●

●

●

●

●

●

sidered. However, if a circuit breaker in an

electrical panel is operating in an unsafe

manner, it also will be accorded a high priority

for funding. . ."

Lack of policy and direction on energy conservation from central office to top management at

the Center. This is due in part to the low priority

accorded to energy conservation by various VA

administrators during the past decade, as well

as the lack of available agency funding for

energy retrofits and capital intensive improvements.

Top management commitment to energy conservation has not been consistent. Some past

hospital administrators have placed a greater

emphasis on energy conservation than others.

Lack of a comprehensive energy management

program and an energy coordinator who would

be responsible for implementation of such a

program.

Lack of internal incentives to conserve energy,

both for staff and Center as a whole. Although

the annual DOE Federal Energy Efficiency

Awards recognize achievements of selected

Federal energy managers, the availability of

additional incentives for other agency personnel is nonexistent. Furthermore, if the Center

does achieve energy cost savings, these savings

cannot be used for future energy conservation

projects, but are retained in the general utility

fund by the central office.

Limited availability of funding and the long lag

time (3 to 4 years) in obtaining appropriations

after the need for the money has been identified. This factor is becoming increasingly

important because the Center has implemented

many of the no cost/low cost measures, and

mostly the significant cost projects remain.

Not enough qualified staff to undertake energy

conservation improvements. For this reason

and because of limited availability of funds, the

Center cannot benefit from the current utility

rebate programs, particularly with respect to

lighting.

Lack of awareness of new energy conservation

products and techniques because the Center

does not reimburse engineering and operation

staff for attending workshops and conferences

or even becoming members of associations

(American Society of Heating, Refrigerating

and Air-Conditioning Engineers, Association

of Energy Engineers, etc.) involved in energyrelated fields.

CASE STUDY 3:

SAN DIEGO DIVISION OF THE

U.S. POSTAL SERVICE, CA

The San Diego Division of the U.S. Postal Service

administers over 370 postal facilities located in two

mail sectional centers (MSCs), one in San Diego and

the other in San Bernadine.

Current Energy Use

Energy sources used at the Division include

electricity, gasoline, and a small amount of natural

gas. Electricity is used primarily for ventilation,

space cooling (in inland facilities only), lighting, and

by electrically driven mail processing equipment.

Lighting systems account for about 40 to 50 percent

of the total electricity consumed. Natural gas is used

for space heating and water heating. Gasoline is the

primary fuel used by the Division’s vehicles.

Figure 5-2 summarizes annual building energy

use for 1985, 1987, and the most current 12 months.

Although energy conservation programs have resulted in reduced energy use, reductions have been

offset by increased energy consumption due to

several factors as discussed below.

Photo credit: Robin Roy

Automated mail handling equipment improves service and

reduces costs, but increases electricity use.
76 ● Energy Efficiency in the Federal Government: Government by Good Example?

Figure 5-2—Energy Consumption at USPS San Diego Division, Fiscal Years 1985, 1987, and 1990

Electricity

Thousand kWh

35,000 I

30,000

25,000

20,000

15,000

10,000

5,000

0

1

1985 1987 1990

Fiscal year

EZZ Consumption

Natural gas

Thousand cubic feet

2 5 0

1985 1987 1990

Fiscal year

0 Consumption

LPG

Gallons

10,00 0

8,000 

6,000

4,000

2,000 I

I

1985 1987 1990

Fiscal year

NXXl Consumption

SOURCE: EMR, “Case Study of Federal Building Energy Use,” contractor report prepared for OTA, December 1990,

Factors Affecting Energy Use

Three factors are influencing greater energy use in

the Division:

●

●

New automated mail processing equipment

(e.g., bar-code sorters, optical character readers, letter sorting machines, and flat sorting

machines) is being added fairly rapidly to

central facilities as well as large and associate

post offices. The goal throughout the U.S.

Postal Service is 100 percent bar-coded mail by

1995.

Increased automation in certain facilities is

necessitating the use of air conditioning to

control humidity at levels conducive to the

●

operation of the automated mail processing

equipment.

New and expanded facilities are adding more

square footage and additional energy using

support equipment under the control of the

Division.

Energy Conservation Efforts to Date

The Division has had a successful energy conservation program for several years. In fact, it received

a national corporate energy award from the Association of Energy Engineers in 1990, and the energy

coordinator at the facility was named energy manager of the year. The Division also won a 1990

Federal Energy Efficiency Award.
Chapter 5--Six Case Studies ● 77

Energy conservation efforts at the Division date

back to 1984 when a postmaster at one of the

facilities took personal interest in energy conservation and obtained support from the general manager

to initiate energy conservation programs at his

facility. These efforts reduced that facility’s energy

use by 25 percent. Realizing the success of these

efforts, the Division has encouraged other facilities

to initiate similar energy conservation programs.

The Division general manager/postmaster is committed to energy conservation and management. One

innovative action taken by the general manager

several years ago involved the creation of a division

energy coordinator’s position. Once on-board, the

new energy coordinator initiated the Federal Government’s first shared energy savings (SES) contract

to retrofit lighting at the San Diego General Mail

Facility. According to the energy coordinator,

The results to date have been impressive. Energy

savings have far exceeded those projected. One

reason for these huge savings is that the Division has

been incredibly aggressive in the enforcement of this

contract.

The primary focus of the energy conservation

program to date has been retrofit of lighting systems.

In 1987, the Division negotiated a shared energy

savings (SES) contract to retrofit lighting systems at

the San Diego General Mail Facility comprising

398,626 total square feet of floor area, a few percent

of the Division’s total. The retrofit involved replacing 2,292 existing fluorescent lighting fixtures and

their associated ballasts, and removing 992 others. It

included installation of energy efficient magnetic

ballasts, specular reflectors, and new 34-watt lamps.

The retrofitted systems are now maintainingg the

same light levels with two lamps, instead of four

lamps used in older systems with considerably less

heat and energy consumption. The SES contract has

not only met but has exceeded energy savings

expectations of the Division to date.

Even though the SES contract has proven successful in reducing energy use, there are no plans to use

SES again at the Division’s other facilities because

local utilities are providing substantial rebates of 40

percent or more for every dollar invested in retrofitting existing lighting systems with energy efficient

lamps and electronic ballasts. Rebates are also

available for a variety of other energy efficient

equipment retrofits (e.g., high-efficiency space conditioning equipment, high-efficiency motors, daylighting controls). By using Postal Service investment funds and utility rebates rather than SES, the

Division has been able to retain all the cost savings

in several recently conducted lighting retrofits.

Some of the no cost/low cost energy conservation

measures that have been implemented at various

facilities to date are shown in table 5-5.

Energy Conservation Potential

Based upon the successful results of the SES

project, lighting surveys have been conducted at all

Division facilities larger than 3,000 square feet to

determine the potential for additional lighting system retrofits. As shown in table 5-6, a significant

potential for energy reductions still exists. Division

personnel estimate that up to 35 percent reduction in

energy use can be achieved if the following measures are implemented. Several of the lighting measures are being implemented in 1991 using Postal

Service funds and utility rebates.

Table 5-5—Conservation Measures Implemented at U.S. Postal Service, San Diego Division

No cost/low cost measures:

Shut down ventilation systems during unoccupied periods in

noncritical areas.

Reduced ventilation rates during unoccupied hours to a minimum

in noncritical areas.

Turned off cooling systems during unoccupied hours in noncritical

areas.

Raised chilled water temperatures in accordance with load.

Operated only chilled water pumps and cooling tower fans as

necessary.

Reduced illumination to Ievels consistent with productivity, safety,

and security considerations.

Added switching and timers to turn off Iights when not needed.

Used daylight for illumination in perimeter areas as practical.

Removed unnecessary lamps when those remaining can provide

desired illumination.

Established an effective lighting usage program.

Moved desks and other work surfaces to a position and orientation

that will use installed luminaries to their greatest advantage.

Added photocell or time controls to operate outdoor lighting.

Used light colors for walls, floors, and ceilings to increase

reflectance but avoid specular reflections.

Used more efficient ballasts.

Relocated luminaries to provide light on task areas.

Lowered height of lighting fixtures.

SOURCE: EMR, “Case Study of Federal Building Energy Use,” contractor report prepared for the Office of Technology Assessment, December 1990.
78 ● Energy Efficiency in the Federal Government: Government by Good Example?

Table 5-6--Summary of South County Lighting Retrofit Potential

Total Total fixtures Average Annual kWh

Facility fixtures to be retrofit rate saved

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.

14.

15.

16.

17.

18.

19.

20.

21.

22.

23.

24.

25.

26.

27.

28.

29.

30.

31.

32.

33.

34.

Total

Alpine . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Andrew Jackson . . . . . . . . . . . . . . . . . . . . . . . .

Bonita . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Rancho Del Ray . . . . . . . . . . . . . . . . . . . . . . . .

Chula Vista Main Office. . . . . . . . . . . . . . . . . . .

City Heights Station . . . . . . . . . . . . . . . . . . . . . .

Coronado . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Downtown Station . . . . . . . . . . . . . . . . . . . . . . . .

EI Cajon Main Office. . . . . . . . . . . . . . . . . . . . . .

EI Cajon Bostonia . . . . . . . . . . . . . . . . . . . . . . . .

Encanto Station . . . . . . . . . . . . . . . . . . . . . . . . .

Fashion Valley . . . . . . . . . . . . . . . . . . . . . . . . . .

Hillcrest Station. . . . . . . . . . . . . . . . . . . . . . . . .

Imperial Beach . . . . . . . . . . . . . . . . . . . . . . . . . .

Jamul . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

John Adams . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Lakeside . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

La Jolla Annex. . . . . . . . . . . . . . . . . . . . . . . . . .

La Jolla Main Office . . . . . . . . . . . . . . . . . . . . . .

La Mesa Annex. . . . . . . . . . . . . . . . . . . . . . . . . .

Lemon Grove . . . . . . . . . . . . . . . . . . . . . . . . . . .

National City... . . . . . . . . . . . . . . . . . . . . . . . . .

Navajo Sia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

North Park..... . . . . . . . . . . . . . . . . . . . . . . . . .

Ocean Beach . . . . . . . . . . . . . . . . . . . . . . . . . . .

Pacific Beach . . . . . . . . . . . . . . . . . . . . . . . . . . .

Point Loma . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Santee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

San Ysidro . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Serra Mesa.... . . . . . . . . . . . . . . . . . . . . . . . . .

Southeastern Station . . . . . . . . . . . . . . . . . . . .

Spring Valley... . . . . . . . . . . . . . . . . . . . . . . . .

University Station . . . . . . . . . . . . . . . . . . . . . . . .

William Taft Station . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

119

193

144

77

164

91

121

629

607

166

62

112

261

82

62

65

106

142

383

83

204

122

128

85

113

112

98

180

185

144

60

275

57

213

5,645

108

132

134

62

153

89

105

548

538

154

61

111

218

98

62

67

96

140

367

69

172

96

119

70

113

107

86

180

133

135

58

266

41

161

5,049

0.097

0.086

0.096

0.097

0.078

0.100

0.093

0.096

0.078

0.087

0.099

0.102

0.100

0.096

0.097

0.101

0.098

0.081

0.081

0.098

0.082

0.084

0.088

0.096

0.099

0.078

0.099

0.099

0.086

0.082

0.099

0.087

0.099

0.088

0.092

25,201

36,461

26,269

21,328

38,346

25,336

32,394

137,800

139,576

63,182

17,342

11,609

57,581

9,201

16,125

18,487

18,885

47,787

68,923

17,079

44,857

39,487

22,324

19,181

17,434

35,523

19,693

29,855

25,932

36,033

14,181

73,841

9,062

53,306

1,273,822

SOURCE: EMR, ’’Case Study of Federal Buiiding Energy UseJ’contractor report preparedforthe Offioe ofTechnology Assessment, December 1990.

. Retrofit lighting systems at all facilities listed

in table 5-6 with higher efficiency lamps,

electronic ballasts, and specular reflectors.

● Retrofit lighting systems at the General Mail

Facility at San Diego with higher efficiency

lamps(32watt or T-8s) and electronic ballasts.

This will require renegotiation of the SES

contract, but the savings more than justify this

action.

. Replace each electric motor as it burns out with

an energy efficient motor.

. Replace all incandescent lamps with compact

fluorescent lamps.

. Replace disabled and outdated postal system

energy management and control systems

(EMCS) with direct digital control systems in

central and large facilities. When properly

applied (to HVAC, service water heating and

lighting systems), operated and maintained,

direct digital EMCS can significantly reduce

energy consumption and cost.

● Implement preventive maintenance programs

for HVAC to systems to keep equipment

operating efficiently and cost-effectively. According to the Division energy coordinator,

“About 90 percent of the HVAC system

maintenances performed by outside contractors, and 50 percent of the contractors never

show up to perform the maintenance. Enforcement of maintenance contracts has been a major

problem because of the lack of staff.”

Implementation of most of the lighting-related

energy conservation retrofits present annual return

on investments greater than 50 percent (see example

calculations for one postal facility in table 5-7), with

payback period less than 2 years. Two projects have

an estimated return on investment of around 300

percent. Other energy conservation measures (e.g.,
Chapter 5--Six Case Studies . 79

Table 5-7-Spring Valley Post Office Lighting

Retrofit Analysis

Retrofit savings (kWh)

Lighting kWh-before . .................117,543

Lighting kWh-after . . . . . . . . . . . . . . . . . . . 43,702

Savings (kWh) . . . . . . . . . . . . . . . . . . . . . . . 73,841

Percent reduction . . . . . . . . . . . . . . . . . . . . . 63%

Retrofit savings (dollars)

Savings (kWh) . . . . . . . . . . . . . . . . . . . . .. .73,841

Cost/kWh . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.0865

Lighting savings .. .. .. .. .. .. .. .. .. ... . $6,350.00

A/C savings . . . . .. .. .. .. .. ... ... ......$ 952.50

Reduced maintenance.. .. ... ... ... ....$ 276.00

Total savings/year .. .. .. .. .. .. .. .. ... . . $7,578.50

cost

Retrofit Cost.... . . . . . . . . . . . . . . . . .. .. . .$18,216+3256

(37additional 2x4)

San Diego Gas & Electric incentive.. ... .. $11,632

Net cost . . . . . . . . . . . . . . . . . . . . . . . . . . . ..$9,840

Investment analysis

Savings-years .. .. .. .. .. .. .. .. .. .. . $22,735.50

Annual return on investment . . . . . ... ....$ 77%

Payback period (years) . . . . . . . . . . . . . . . . 1.3

SOURCE: EMR, ’’Case Study of Federal Building Energy Use;’contractor

report prepared for the Office of Technology Assessment,

December1990,

energy efficient motors and EMCS) are also expected to result in payback periods less than 3 years,

particularly when current utility incentives are

accumulated for calculation of net retrofit costs.

Barriers to Energy Conservation

The Division has been a leader in implementing

the first Federal SES contract, and many energy

management opportunities still exist. However,

there are several barriers to further gains:

●

●

●

Relatively low priority is being given to energy

efficiency improvement because utility expenditures compose a very small percentage of the

Division’s overall budget.

Lack of incentives for key personnel to pursue

energy conservation. U.S. Postal Headquarters

has no incentive programs (e.g., cash awards,

recognition certificates, etc.) to recognize employees whose suggestions or actions result in

energy and cost savings. The Divisions also do

not have any such programs.

Inadequate support staff to implement energy

conservation and preventive maintenance programs for facility and building systems and

equipment (HVAC, lighting, etc.).

CASE STUDY 4:

FORT BELVOIR ARMY BASE, VA

The Fort Belvoir Army Base consists of 3,000

buildings including housing, a hospital, research and

development facilities, administrative facilities, a

commissary, cafeterias, warehouses, and hangers.

The Base includes a total area of approximately 10

million square feet of buildings. It houses about

2,300 families and has a total daytime population of

16,000.

Current Energy Use

The total annual energy expenditures for the Base

are about $14 million. Although a variety of energy

sources are used at the Base, electricity and natural

gas are most commonly used. Electricity is used for

lighting and comfort conditioning. It is also used by

computers, security devices, and other electrically

driven equipment. Natural gas is used for space

heating, cooking, and service water heating.

Energy consumption and cost data for the Base for

fiscal years 1980-90 is shown in figure 5-3. Note,

energy use at the Base has increased somewhat since

1987 because of factors as described below.

Factors Affecting Energy Use

Although the Base has implemented some energy

conservation measures, new situations have emerged

and resulted in increased energy consumption for

comfort conditioning, lighting, and computer equipment. These situations are as follows:

More building space is being added to the Base.

For example, a 230,000-square-foot Army intelligence headquarters recently was built. Additional building space is being planned such as

a 3-million-square-foot engineering proving

grounds, a 200,000-square-foot industrial park,

a 120,000-square-foot commissary, and an

80,000-square-foot warehouse.

Daytime population at the Base is projected to

rise from 16,000 to 30,000 by the year 2000.

This includes a large amount of new housing.

More computer equipment is being used in

computer rooms and offices.

Energy Conservation Efforts to Date

The Base has had a formal energy program since

1977 which has implemented many no cost/low cost

energy conservation measures. Some significant
80 ● Energy Efficiency in the Federal Government: Government by Good Example?

Figure 5-3-Fort Belvoir Energy Consumption and

Cost, Fiscal Years 1980-90

Thousand MBtus

2,000 $ millions 20

1,500 15

1,000 10

500 5

0 0

80 81 82 83 84 85 86 87 88 89 90

Fiscal year

Consumption and cost

~ MBtu m Energy $

NOTE: Site accounting used for electricity (1 kWh -3,412 Btus).

SOURCE: EMR, “Case Study of Federal Building Energy Use,” contractor

report prepared for OTA, December 1990.

cost measures have also been performed, such as the

acquisition of an energy management system. Several capital-intensive measures are currently being

studied by the U.S. Army Corps of Engineers,

Baltimore District, for selected buildings. Table 5-8

lists those measures which have been partially or

fully implemented to date.

Energy Conservation Potential

A significant number of no cost/low cost energy

conservation measures have been implemented at

the Base. However, they have not been the result of

any detailed energy audit of the Base or a comprehensive energy management plan. A study of

selected capital-intensive energy conservation measures for specific buildings was underway at the time

of this site visit.

Most measures have been implemented on a

selected basis. Because of inadequate in-house

operation and maintenance staff, many low cost

measures have yet to be implemented or need to be

repeated.

Maintenance of mechanical systems currently is

performed by an outside contractor. However, according to management personnel at the Base,

‘‘There is inadequate monitoring of the contractor’s

performance, and there are not enough incentives for

the contractor to do a good job. The contractor

basically keeps the systems running, but has no

concern for fine-tuning them to conserve energy. ’

Management personnel at the Base estimate that

an additional 20-percent reduction in energy use can

be achieved if the following measures are implemented:

●

●

●

●

●

●

●

●

●

●

●

●

Replace existing ballasts and lamps with higher

efficiency electronic ballasts and T-8 32-watt

lamps.

Replace existing energy management system

with new system employing direct digital

controls. Include optimizing functions on all air

handling units and chillers.

Convert constant air volume systems to variable air volume systems.

Use adjustable speed drives for variable fan

speed control.

Replace all motors with energy efficient motors.

Install economizer cycle controls on all air

handling units with outdoor air intakes.

Trim chilled water pump impellers to match

load.

Balance chilled water and air distribution

systems.

Rehabilitate steam plant and eliminate all

steam leaks.

Calibrate all control systems. A well-planned

program of control adjustment and calibration

should be an important part of any energy

management program. It will save energy and

money, while also improving comfort conditions.

Improve maintenance on all HVAC equipment

to keep it at peak efficiency.

Install automated demand limiting controls.

Barriers to Energy Conservation

Despite the past energy conservation efforts at the

Base, many barriers still must be overcome in order

to achieve further energy and cost savings. These are

as follows:

. Lack of staff to develop recommendations for

energy conservation retrofits and supportive

documentation. According to the Base management personnel, “We have never experienced

problems getting funding providing that we

have full supportive documentation. However,

our staff is so limited that developing ideas and

implementing them is a big problem. ”
Chapter 5--Six Case Studies . 81

Table 5-8-Measures Partially or Fully Implemented to Date at Fort Belvoir

Increase efficiency of heating, ventilating, and airconditioning systems

Maintain systems for efficiency:

Adjusted air dampers for tight closing.

Adjust fuel-air ratings.

Clean combustion surfaces and strainer screens in pumping

systems.

Corrected improper automatic control operation.

Maintained cooling equipment.

Repaired insulation on economizers, condensate receiver tanks,

boilers, furnaces, etc.

Repaired leaks: chilled water, condenser water, conditioned air,

etc.

Sealed all air leaks into combustion chamber.

Used proper water treatment to reduce fouling of heat transfer

surfaces in boilers, heat exchangers, etc.

Operate systems efficiently:

Eliminate or reduce use of HVAC systems which require

simultaneous heating and cooling.

Increase indoor temperature and relative humidity levels during

cooling season as practical.

Keep air movement in and out of radiators and connectors

unrestricted.

Locked thermostats to prevent resetting by unauthorized

personnel.

Optimize ventilation startup times.

Reduce cooling in over-cooled spaces.

Reduce fan speed.

Reduce ventilation rates during unoccupied hours to a minimum

in noncritical areas.

Turn off cooling system during unoccupied hours in noncritical

areas.

Turn off or eliminated all portable electric heaters when not

needed.

Use the minimum number of boilers.

Use outdoor air for economizer cooling.

Use spot cooling of people when they were located far apart.

Upgraded equipment to allow efficient operation:

Added automatic draft damper control to reduce heat loss through

breaching when the gas or oil burner is not in operation.

Added controls to setback temperatures during unoccupied

periods in noncritical areas.

Installed economizer cycle.

Installed automatic ventilation controls.

Installed time clocks on self-contained cooling units for automatic

shutoff.

Installed valves and dampers to permit shutoff of heating in

unoccupied areas where there is no danger of freezing.

Installed warmup cycle controls on air handling units with outside

air intake as applicable.

Installed vestibules and/or revolving doors to reduce infiltration.

Converted constant-volume fan system to variable air Volume.b

Replaced inefficient window air conditioners.b

Isolated off-line boilers.b

Installed central supervisory control system.b

Installed automatic temperature control valves in radiators

controlled by hand valves.b

Insulated steam lines, above and below ground. b

Insulated chilled water piping and duct work carrying conditioned

air through unconditioned spaces.

Improve the building envelope

Added additional insulation to roofs, ceilings and floors over

unconditioned areas.b

Added additional insulation to walls. b

Caulked and weatherstripped windows and door frames.

Installed loading dock door seals.

Lowered indoor temperature and relative humidity.

Reglazed ail glass with double glazing. b

Reduced solar heat gain.

Repair cracks and openings in exterior surfaces.

Replace broken windows.

Used opaque or translucent insulating materials to block off and

thermally seal unused windows.

Used infra-red television camera to determine where heat losses

are occurring from buildings and underground distribution

piping.b

Improve lighting efficiency

Reduce uneeded illumination:

Added switching and timers to turn off lights when not needed.

Moved desks and other work surfaces to a position and orientation

that used installed Iuminaires to their greatest advantage.

Relocated Iuminaires to provide light on task areas.

Removed unnecessary lamps when those remaining can provide

desired illumination.

Use daylighting for illumination in perimeter areas as practical.

Use light colors for walls, floors and ceilings to increase

reflectance but avoid specular reflections.

Increase efficiency of lamps, ballasts and fixtures:

Added photocell or time controls to operate outdoor lighting.

Used higher efficiency lamps and ballasts.

Clean lamps, Iuminaires and interior surfaces.

Miscellaneous

Boost hot water temperature locally.

Improved maintenance of motors.

Installed and maintained insulation on all hot water pipes, fittings

and valves passing through unconditioned spaces.

Installed efficient nozzles and faucets and orifices in hot water

pipes to reduce flow.

Recover heat from kitchen waste for water heating.

Replaced gas pilots with electric ignition device.

Use demand limiting equipment (e.g., on electric water heaters)

during periods of peak electrical demand.

Turn off electrical appliances and machinery not being used.

aunless othe~ise noted, all measures are considered by facility personnel to be low cxXd or no cost.

bsignificant c=t measure as identified by facility personnel.

SOURCE: Adapted from Enviro-Management & Research, “Case Study of Federal Building Energy Use,”

Technology Assessment, December 1990.

contractor report prepared for the Office of
82 ● Energy Efficiency in the Federal Government: Government by Good Example?

●

●

●

●

●

Lack of internal incentives to conserve energy,

both for operating personnel and the Base as a

whole. According to facility personnel, ‘‘In the

early 1980s, an incentive program was in place

whereby the installation that saved the most

energy in one year received a proportion of the

energy cost savings, which sometimes amounted

to as much a $1.5 million.” This program was

abandoned in 1985.

Lack of an energy management plan, direction,

and guidance from top management. Because

operating staff is so limited and the Base is so

large, facility personnel need guidance from

top management and professional engineering

staff to develop and implement cost-effective

energy conservation projects.

Lack of proper maintenance of HVAC systems

and equipment. A properly planned and executed program of equipment maintenance can

contribute significantly to reduced waste. Equipment which is correctly and regularly serviced

and maintained will last longer and will operate

more efficiently, thereby requiring relatively

less energy than equipment which is ignored.

For example, a scale build-up of l/32-inch on

condenser tubes can reduce the efficiency of a

chiller by 25 percent, while also cutting down

on the effective life of the unit.

Inadequate contractor incentives based on performance of maintenance on mechanical systems. Under the current contract, the maintenance contractor is provided no incentives such

as cash awards for fine-tuning equipment and

controls and saving energy. Its main responsibility is just to keep the systems running.

Shortage of field personnel to inspect equipment and systems and contractor performance.

Currently, there is only one quality assurance

inspector who performs random inspections

and evaluations of contractor performance.

More inspectors are needed.

CASE STUDY 5:

GSA-LEASED OFFICE BUILDING,

WASHINGTON, DC

This privately owned office building is leased by

the General Services Administration and occupied

by several Federal agencies. Built over two decades

ago, the building consists of 88,933 square feet and

houses about 750 to 800 daytime employees on

weekdays.

Current Energy Use

Several energy sources are used at this GSAleased building. Electricity is primarily used for

space cooling, ventilation, lighting, cooking, and

other electrically driven equipment and machinery.

Natural gas is used for space and service water

heating purposes. Utility bills are paid by the

building owner.

According to the building manager, “Overall

energy use at the building has slowly increased in

recent years, due primarily to increased occupancy

and increased use of personal computers. ” This

trend could not be verified because building energy

consumption and cost data were not provided by the

building owner.

Factors Affecting Energy Use

Although the building has implemented a range of

energy conservation measures, the following new

situations have resulted in increased energy consumption:

. Personal computers are being used increasingly

in the building.

. Occupancy levels have increased approximately

25 percent in recent years.

. New mechanical and electrical equipment has

been added to the building to support increased

occupancy levels.

Energy Conservation Efforts to Date

Many no cost/low cost measures have been

implemented at this building since 1985. Some of

these improvements have involved significant cost

options such as lighting fixture retrofit. Several

capital-intensive measures are currently being studied. Table 5-9 lists those measures which have been

partially or fully implemented to date.

Energy Conservation Potential

Because the building has implemented mostly no

cost/low cost measures, a significant potential for

further energy conservation still exists. Operating

personnel estimate that up to a 20-percent reduction

in energy use can be achieved if the following

measures are implemented:

. Use more efficient ballasts.

. Reduce quantity of service hot water used.
Chapter 5--Six Case Studies ● 83

Table 5-9-Energy Conservation Measures Implemented at GSA Leased Buildinga

Increase efficiency of heating, ventilating, and airconditioning systems

Maintain systems for efficiency:

Adjusted all pumps to control leakage at pump packing glands.

Adjusted outdoor air dampers for tight closure.

Adjust fuel-air ratio and clean filters and combustion surfaces.

Checked flues and chimney for blockages or improper draft

conditions.

Clean strainer screens in pumping stations.

Corrected improper automatic control operation and recalibrated

controls.

Keep maintenance and operating log of all heating equipment.

Maintain all cooling equipment.

Repaired insulation on economizers, condensate receiver tanks,

boilers, furnaces, etc.

Repaired leaks in water, steam, air, fuel distribution system.

Repaired faulty steam traps, valves, dampers, etc.

Sealed air leaks into combustion chamber.

Use proper water treatment to reduce fouling of heat transfer

surfaces in boilers, chillers, heat exchangers.

Operate systems efficient/y:

Do not cool lobbies, passageways and storage areas to same

degree as work areas.

Eliminate or reduce use of HVAC systems which require

simultaneous heating and cooling.

Increase indoor temperature and relative humidity during cooling

season as practical.

Keep air movement in and out of radiators and connectors

unrestricted.

Iower temperature and humidity as practical in heating season.

lacked thermostats to prevent resetting by unauthorized

personnel.

Operate heating water and chilled water pumps and cooling tower

fans only as necessary.

Operate condenser water system at lower temperature.

Optimize ventilation startup times.

Rebalanced chilled water and air distribution systems.

Reduce ventilation rates during unoccupied hours as practical.

Reduce heating/cooling in over-heated/-cooled spaces.

Turn off cooling system and portable electric heaters during

unoccupied hours in noncritical areas.

Use lowest possible radiation temperature in perimeter spaces.

Use the minimum number of boilers and chillers.

Use outdoor air for economizer cooling.

Vary temperature of supply air, chilled water, and heating water

and pressure of steam in accordance with load.

Upgraded equipment to allow efficient operation:

Added controls to set back temperatures during unoccupied

periods in noncritical areas.

Connected ventilation fans in toilet rooms to light circuit.

Converted constant-volume fan system to variable air volume.

Installed warmup cycle controls on air handling units with outside

air intake as applicable.

Installed economizer cycle.

Installed automatic ventilation controls.

installed valves and dampers to permit shutoff of heating in

unoccupied areas where there is no danger of freezing.

Installed automatic temperature control valves in radiators

controlled by hand valves.

Installed and maintain insulation on all hot water pipes, fittings and

valves passing through unconditioned spaces.

Installed central supervisory control system.

Insulated all duct work carrying conditioned air through

unconditioned spaces.

Insulated chilled water piping and ductwork located in

unconditioned spaces.

Insulated all steam Iines.b

Isolated off-line chillers and boilers.b

Recovered heat from condenser water system.b

Reduced air flow rates to minimally satisfactory Ievels. b

Replaced existing boilers which are not at or near the end of their

useful life with modular boilers. b

Used low resistance filters, registers and grilles to reduce

horsepower required for air movement.b

Improve the building envelope

Add additional insulation to roofs, ceilings and floors over

unconditioned areas.b

Caulked all windows and door frames.

Established rules for building personnel to keep doors and

windows closed when possible when heating system is

operating.

Installed automatic door closers on all exterior doors.

Repaired cracks and openings in exterior surfaces.

Replace broken windows.

Improve lighting efficiency

Reduce uneeded illumination:

Added photocell or time controls to operate outdoor lighting.

Added manual switches and timers to turn off lights when not

needed.

Reduced illumination to levels consistent with productivity, safety

and security considerations.

Removed unnecessary lamps when those remaining can provide

desired illumination.

Revise cleaning schedule so lights can be turned off earlier.

Use daylighting for illumination in perimeter areas as practical.

Use light colors for walls, floors and ceilings to increase

reflectance but avoid specular reflections.

Increase efficiency of lamps, ballasts and fixtures:

Clean lamps, Iuminaires and interior surfaces.

Used higher efficiency Iamps.b

Miscellaneous

Avoid using electric water heater during periods of peak electrical

demand.

Balanced water flows to minimally satisfactory Ievels.b

Examined elevator usage; shut down excess capacity.

Installed demand limiting equipment. b

alJnless otherwise noted, all measures are considered by facility personnel to be kMN ~st or no cost.

bsignifbant Cmt me~ure as identified by facility personnel.

SOURCE: Adapted from Enviro-ldanagement & Research, “Case Study of Federal Building Energy Use,” contractor report prepared for the Office of

Technology Assessment, December 1990.
84 ● Energy Efficiency in the Federal Government: Government by Good Example?

●

●

●

●

●

●

Reduce service water heating, generating, and

storage temperature levels to the minimum

required.

De-energize hot water circulating pumps when

the building is unoccupied.

Install occupancy sensors, timers, and switches

to control lighting.

Optimize HVAC system controls.

Use booster heaters for food service. Instead of

maintaining the central service water heating

temperature at a higher level to satisfy the

needs of the food service facility, reduce the

temperature of the central systems and add a

booster heater at the food service area to elevate

water temperature locally.

Convert constant air volume air handling systems to variable air volume systems.

Barriers to Energy Conservation

Building operating personnel perceive no barriers

to their energy conservation efforts. According to

the building manager, “The building owner is

committed to energy conservation and closely examines energy consumption on a regular basis.

Adequate staff is available to keep systems and

equipment operating effectively. Furthermore, funding for energy conservation retrofits, training and

continuing education is available provided that

requests are properly supported with technical documentation and analysis of cost/benefits. ’ However,

energy conservation efforts at the facility are largely

dependent upon recognition of opportunities by

building management and operating personnel. Because further potential for energy conservation still

exists at the facility, future energy conservation

efforts will depend upon the implementation schedule established by the building manager.

The building is monitored by GSA leasing inspectors who, for the most part, are not engineers. Thus,

they cannot offer suggestions and guidance to

building operating and maintenance personnel with

regards to energy efficiency improvements. At one

time, GSA provided a 30-month training program

for leasing inspectors, but it was discontinued

several years ago.

According to a GSA manager overseeing leasing

operations at this building, ‘‘Most of the knowledgeable operating staff that GSA had at one time has

been hired by private industry. This is because the

industry pays them higher salaries and provides

better benefits. Current building lease inspectors at

GSA are GS-9s, a pay level substantially lower than

a person performing the same duties in private

industry. This has substantially curbed GSA’s efforts to properly monitor leased buildings and to

provide suggestions for cost-effective energy improvements.’

CASE STUDY 6:

RICHMOND REDEVELOPMENT

AND HOUSING AUTHORITY,

RICHMOND, VA

The Richmond Redevelopment and Housing Authority (RRHA) manages 4,500 housing units in 20

different projects. A total of 16,000 residents live in

the various projects, many of which were constructed almost half a century ago. All facilities are

heated. Only high-rise facilities housing the elderly

are provided with air conditioning, using central

chilled water systems. Occupants can install their

own window air-conditioning units, but they have to

pay a monthly usage charge to the Authority.

Current Energy Use

Utility expenses (including water and sewer)

constitute 40 percent (approximately $5 million) of

the Authority’s budget. Several types of energy

sources are used at various facilities managed by the

Authority. Electricity is used for Lighting and

electrical equipment in all projects. It also is used in

certain projects for electric space and service water

heating. In the majority of the projects (4,100 units

or 91 percent), natural gas is used for space and

service water heating purposes.

Annual energy consumption for all projects at the

Authority for selected years is shown in figure 5-4.

Although electricity use has increased by about 28

percent since 1984, gas use has decreased by about

25 percent. Despite implementation of various

energy conservation measures, electricity use has

increased due primarily to increased use of window

air-conditioning units by tenants. On the other hand,

gas use has declined because of implementation of

certain energy efficiency improvements, as well as

close monitoring and control by a central EMCS at

various projects.
Chapter 5-Six Case Studies ● 85

Figure 5-4-Richmond RHA Annual Energy Consumption for Selected Years

Electricity

.- Thousand MWh

3 5

30 

25

20

15

10

5

0

1984 1986 1990

Fiscal year

IZZ Consumption

Natural gas

--A Million cubic feet O(JU

400

300

200

100

0

1984 1986 1990

Fiscal year

U Consumption

SOURCE: EMR, “Case Study of Federal Building Energy Use,” contractor report prepared for OTA, December 1990.

Factors Affecting Energy Use

Although the Authority has implemented a range

of energy conservation measures, the following new

situations have resulted in increased energy consumption for building systems:

● Use of air-conditioning window units by tenants has increased in multifamily projects.

. Authority lacks control over how the tenant

uses energy. The Authority does provide guidance to tenants on how to use energy efficiently. However, it has no control over tenants’ energy habits (e.g., tenants leaving windows open while HVAC equipment is running

or tampering with thermostat set points).

Energy Conservation Efforts to Date

A few energy conservation measures were implemented at various projects as early as 1982. However, most of the energy conservation measures that

have been implemented to date were initiated in

1985 when a new general engineer at the Housing

and Urban Development (HUD) Richmond field

office was assigned responsibility for RRHA. He

took personal interest in energy conservation and

sought top management commitment in reducing

energy consumption and implementing energy conservation measures. His achievements to date include obtaining funding for new computers for use

by the Authority to provide more accurate building

292-861 91 - 5

energy use data and information, and initiating and

obtaining funding for a variety of energy conservation projects at the Authority.

A central EMCS has recently been added to

monitor and control heating and selected cooling

systems in four family projects. RRHA’s experience

with its EMCS has been very productive. RRHA

developed in-house EMCS expertise with an enthusiastic and highly competent staff, leading to innovative use of their system. In addition to providing

considerable energy savings, the EMCS’ remote

monitoring capabilities have helped reduce maintenance service calls.

Many energy conservation measures have been

implemented in some, but not all, projects. Several

capital-intensive measures are currently being studied. Table 5-10 lists those measures which have been

implemented to date at various projects. Implementation of these measures has yielded savings of

approximately half a million dollars annually.

Energy Conservation Potential

A significant potential for further energy conservation still exists. According to the engineers at

HUD and the Authority, ‘‘We have already reduced

energy consumption due to various energy conservation actions that we have taken to date. Our ultimate

goal is to reduce energy consumption to 55,000

Btu/ft 2

, a reduction of over 50 percent.’
86 ● Energy Efficiency in the Federal Government: Government by Good Example?

Table 5-10-Energy Conservation Measures

Implemented to Date at Richmond Redevelopment

Housing Authority

Replaced doors with steel thermally insulated doors.

Installed insulation in walls.

Installed foam insulation in brick and block units.

Replaced old boilers with high-efficiency condensing boilers

having digital controls.

Weatherstripped and caulked all windows and doors.

Replaced all plumbing fixtures with water savings devices.

Installed fluorescent lighting and solid-state ballasts where

necessary.

Performed annual preventive maintenance on all heating units.

Performed annual preventive maintenance on all plumbing

fixtures.

Added thermostatic controls on the radiators to vary circulating

water temperature.

Added central energy monitoring system at four projects to control

heating and cooling systems.

SOURCE: EMR, “Case Study of Federal Building Energy Use,” contractor

report prepared for the Office of Technology Assessment,

December 1990.

The Authority intends to

reductions by continuing

conservation measures such

●

●

●

achieve further

to implement

energy

energy

as the following:

Adding insulation to walls in high-rise buildings.

Installing automatic lighting on/off controls.

As example, when automatic lighting controls

were installed in a high-rise facility, a 78-

percent lighting energy savings was experienced in the facility and payback was in less

than a year.

Installing motion detectors connected to electric baseboard heaters. As example, when the

person walks into the room, the heater comes

on to maintain 72 ‘F. When a person walks out

●

of the room, the heater controls set back to

68 OF.

Expanding the central EMCS (which currently

controls 4 of the 20 projects) to monitor and

control heating and cooling systems at all

projects.

Barriers to Energy Conservation

The following are barriers to energy conservation:

The 3-year rolling base existing under the

Performance Funding System has prevented

full implementation of many energy conservation measures. This program was set up by

HUD and enacted by Congress. Under this

program, HUD provides individual authorities

with funding for approved energy conservation

projects. Both HUD and the Authority equally

share in the savings derived from the implementation of energy conservation measures. At

the end of 36 months, the Authority does not

receive any share of further savings. Furthermore, the Authority must pay a penalty to HUD

if it exceeds the newly established energy

consumption levels.

Lack of incentives for authorities to implement

energy conservation programs. In many cases,

savings cannot be applied to the facility

because of allowable expense level requirements. For example, higher efficiency heating

systems are more sophisticated and require

more maintenance. Although they result in

considerable savings, no allowance is provided

for expenses associated with additional maintenance.
Chapter 6

Constraints on Increased

Federal Energy Efficiency

. . If there's such great potential,

why is it not being captured?)
Contents

Page

INTRODUCTION .. . .. .. .. .. .., . ... . . . . . . . . . . .. .. .. .. .. 89

RESOURCE CONSTRAINTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ....-..-....”..”””” 89

Resource Priorities Favor Other Needs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89

Most Energy Efficiency Options Require Scarce Initial Funding . . . . . . . . . . . . . . . . . . 91

Virtually All Energy Efficiency Measures Require Personnel .. .. . .. ... ... 92

INFORMATION CONSTRAINTS .. .. .. .. .. .. .. .. .. ... ... ..... ... .. ... ..,.... 93

Prospects for Federal Energy Efficiency Have Not Been Systematically Assessed. . 93

Many Measures Have Uncertain Technical and Economic performance . . . . . . . . . . . . 94

Federal Energy-Use Decisions Are Made by Many Thousands of Individuals

With Diverse Perspectives and Responsibilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95

LACK OF INCENTIVES . . . . . . . . . . . . . . . . . . . . . . . . . ● . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99

There Have Been Few Rewards for Efficiency and Penalties for Waste . . . . . . . . . . . . . . 99

Procurement Policies Are Challenging . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100

Boxes

Box Page

6-A. Energy Program of the U.S. Army in Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ● . . 97

6-B. General Services Administration Memorandum Sent to All District and Buildings

Managers in the National Capital Region . . . . . . . . . . . . . . . . . . . .................. 100

Figures

Figure Page

6-1. Direct Federal Energy Efficiency Funding, Fiscal Years 1976-90 .............,.. 90

6-2. Energy Spending Compared to Total Budget for Selected Agencies,

Fiscal Year 1989 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91

6-3. Historical Energy Price Trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..... 94

6-4. Simplified VA Energy Investment Decision Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98

Tables

Table Page

6-1. Constraints unimproved Federal Energy Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89

6-2. Attendance at 656 Committee Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ● ..n. 90
Chapter 6

Constraints on Increased Federal Energy Efficiency

(or ● . . If there’s such great potential,

why is it not being captured?)

INTRODUCTION

The preceding chapters have suggested that a

large fraction of the energy paid for by the Federal

Government is wasted. How is that possible? There

is no single, simple explanation for all the missed

opportunities. There are many reasons, each a

constraint to more effective energy efficiency efforts. If left unaddressed, each can inhibit some of

the gains which appear technically feasible and

economically desirable. OTA identified eight common constraints which can be loosely grouped into

three types: 1) constraints on the resources (e.g.,

funding and personnel) needed to implement energy

efficiency measures, 2) a lack of information about

the available opportunities, and 3) incentives which

do not encourage efficient energy management.1

Over the past 15 years, both Congress and the

Federal agencies developed several programs which

helped ease constraints on increased efficiency in

the Federal Government, as described in chapter 2.

Implementation efforts have varied over time, however, and general conditions such as the cost of

energy and the performance of efficient technologies

have also changed. As a result, the constraints on

increased efficiency have changed over time, as

well. The following sections describe the constraints

listed in table 6-1.

RESOURCE CONSTRAINTS

Resource Priorities Favor Other Needs

Energy efficiency projects often receive relatively

low priority for funding and personnel, even those

with rapid paybacks. Because of the general constraints on funding and manpower that all institutions face (including Federal agencies), this low

priority results in foregone opportunities.

Table 6-l—Constraints on Improved Federal

Energy Efficiency

Resource constraints

Priorities favor other agency needs.

Energy efficiency is not central to most agencies’ missions.

Energy is a small component of most agencies’ expenditures.

Little senior management interest.

Many measures require initial capital spending.

Many measures require personnel.

Many facilities have no energy coordinator.

Information constraints

Opportunities have not been systematically assessed.

No governmentwide estimates of potential.

Little analysis of results of different measures.

Agencies are uncertain of technical and economic performance.

Does this technology really work?

Lack of detailed energy use metering.

Would the facility be better off waiting for next year’s model?

Too few demonstration programs.

Too little information sharing between agencies.

Energy-use decisions are dispersed, made by thousands of

individuals.

Implementation requires coordinated effort from diverse

parties.

Too little training and education for diverse parties.

Lack of incentives

Dollar savings often do not accrue to energy savers.

Energy costs are readily passed through budgets.

Cost savings are often not retained at facility.

incentives for facility staffs are often indirect.

Federal procurement policies often favor status quo.

Procurement practices are complex, often restrictive.

SOURCE: Office of Technology Assessment, 1991.

An example of low priority can be seen in low

attendance rates at the Federal Interagency Energy

Policy Committee (the 656 Committee2

), which is

composed of assistant secretaries and assistant

administrators of several agencies. As shown in

table 6-2, the 656 Committee has had very low

turnout of the actual members at its mandatory

annual meeting, although lower level substitutes are

usually present. Another example of the low priority

energy receives can be seen in agency capital

budgets dedicated to energy efficiency improvelr)espite the COn.StraiIItS therea.remany examples of highly motivated Federal employees who find ways to save energy and money for the gov ernmen~

and take advantage of whatever energy efficiency opportunities they can. See, for example, U.S. Department of Energy, Federal Energy Management

Program, ‘‘Annual Report to Congress on Federal Government Energy Management and Conservation Programs Fiscal Year 1989,’ October 1990, App.

H. This appendix describes winners of the amual Federal Energy Efficiency Awards for 1990.

walled the 656 Committee since it is established under Section 656 of the Department of Energy Organization Act of 1977 (see ch. 2).

–89–
90 ● Energy Efficiency in the Federal Government: Government by Good Example?

Table 6-2—Attendance at 656 Committee Meetings Figure 6-l—Direct Federal Energy Efficiency Funding,

Fiscal Years 1976-90

Agency 1988 1989 1990

Department of Energy . . . . . . . . . . A

Department of Defense . . . . . . . . . sub

Assistant Secretary of Defense

(Production & Logistics)

VA . . . . . . . . . . . . . . . . . . . . . . . . . . sub

Principal Deputy Assistant

Secretary

Acquisition & Facilities

GSA . . . . . . . . . . . . . . . . . . . . . . . . . sub

Commissioner of Public

Buildings Service

DOC . . . . . . . . . . . . . . . . . . . . . . . . . sub

Assistant Secretary for

Administration

HUD . . . . . . . . . . . . . . . . . . . . . . . . . sub

Assistant Secretary for

Administration

Department of Treasury. . . . . . . . . sub

Assistant Secretary for

Administration

USDA . . . . . . . . . . . . . . . . . . . . . . . sub

Assistant Secretary for

Administration

Department of the Interior . . . . . . . sub

Assistant Secretary for Policy,

Budget & Administration

NASA . . . . . . . . . . . . . . . . . . . . . . . sub

Assistant Administrator for

Management

USPS . . . . . . . . . . . . . . . . . . . . . . . sub

Assistant Postmaster General

for Engineering & Technical

Support

A

sub

sub

sub

sub

sub

sub

sub

sub

sub

sub

A

sub

sub

sub

sub

sub

sub

sub

sub

sub

sub

KEY: A-attended by assistant secretary/administrator;

sub-Attended by substitute.

SOURCE: “656 Committee” Meeting Minutes, 1988-1990.

ments over the past decade, as shown in figure 6-1.

Notably, the Department of Defense’s (DOD’s)

budget request reached zero for fiscal year 1990

although more funding for 1991 and beyond is

planned. A third example of the low priority can be

seen in the lapsing in 1985 of the energy conservation goals set forth by the Executive order (see ch. 2).

The delay in issuing a follow-on order with revised

goals reflected a lack of priority set on energy

efficiency in the executive branch.

Two reasons help explain energy efficiency’s low

priority. First, with the notable exception of the

Department of Energy (DOE), energy efficiency

is not fundamental to the mission of most agencies. For example, the mission of the Department of

Millions of nominal dollars

350

300

250

200

150

100

50

0

76 77 78 79 80 81 82 83 84 85 86 878889 90

& prior plan

Fiscal year

Agency

= Defense = Energy ~ V A

m USPS = G S A = Other

SOURCE: U.S. Department of Energy, Federal Energy Management

Program, Report on Federal Government Energy Management

and Conservation Programs, Fiscal Years 1987-89; and “Federal Ten-Year Building Plan,” DOE-CE-0047, September 1983.

Veterans Affairs (VA) is to promote the health and

well-being of veterans, through such means as the

VA hospitals and clinics and through support

programs for housing and education. Similarly, the

mission of the U.S. Postal Service (USPS) is to

deliver mail speedily and accurately. At the Department of Housing and Urban Development (HUD),

priorities such as safety- and health-related rehabilitation compete for scarce HUD funds. For example,

HUD was directed by the House and Senate Appropriations Committees to reprogram funds in fiscal

year 1989 giving a high priority for a lead testing and

abatement program.3 For these agencies and all other

agencies, energy is only one required input in

performing their mission, and plays only an indirect

role.

Secondly, even energy efficiency’s indirect role

in the mission of most agencies is generally small,

reflecting the small amount that energy costs

constitute. Reducing energy costs could free up

funds for use in better performin g an agency’s

mission. However, energy typically warrants relatively little time and-attention from senior management based on its small contribution to total

agency costs (see figure 6-2). For example, assume

that the USPS was able to eliminate energy spending

entirely. Even in that extreme and impossible case,

the price of a first-class stamp would merely drop

from 29 to 28 cents. Labor spending in the USPS far

3u.s. House of Represenwtives, Conference Report to Accompany H.R. 4800, Report 100-817, IOOti COW., 2d sess.t P. 10
Chapter 6--Constraints on Increased Federal Energy Efficiency . 91

Figure 6-2—Energy Spending Compared to Total

Budget for Selected Agencies, Fiscal Year 1989

Billions of dollars

500

400

300

200

100

0

Energy Total budget

Agency

= DO D = DOE - GS A

m USPS O V A

SOURCE: Federal Energy Management Progam data and fiscal year 1991

Federal budget.

exceeds energy costs, making labor far more important. In fact, reducing postal costs through automation actually increases energy use, as energy and

capital substitute for labor.

A new Executive order on Federal energy management signed on April 17, 1991 (see ch. 2) should

bean important component of a program to place a

higher priority on energy- and cost-saving opportunities throughout the government. Similarly, renewed support at high levels can be seen in a

memorandum setting goals and guidance for facility

energy management sent by the Deputy Secretary of

Defense on March 13, 1991.4 While an Executive

order in itself is not enough to ensure energy

efficiency, together with a dedicated implementation campaign, including appropriate budget and

staffing requests, it will demonstrate a high priority.

Most Energy Efficiency Options Require

Scarce Initial Funding

Most energy- and cost-saving projects such as

replacing lamps and fixtures require a commitment

of funding, including annual operating and maintenance costs or initial capital costs, or both. However,

funding, particularly for initial investment, is typically in short supply.

Many energy efficiency projects have rapid paybacks of 3 years or less, representing a return on

investment far greater than the Treasury’s cost of

funds. Despite these opportunities, Federal agencies

have not sought and have not received a stable

source of funding for even their most productive

energy efficiency projects over the past decade. For

example, total capital spending earmarked specifically for energy efficiency projects dropped from a

high of $297 million in 1981 to under $50 million in

1990, a decline of 80 percent in nominal dollars, or

90 percent in inflation-adjusted dollars (see figure

6-1).5

That trend appears to be reversing partly. For

example, DOD’s fiscal year 1991 energy efficiency

capital investment funding has been raised to $10

million, up from zero in fiscal year 1990 with a target

of $50 million annual funding starting in 1993.6

Similarly, the General Service Administration’s

(GSA) planned energy investments have increased

from $5 million in fiscal year 1989 to $30 million in

fiscal year 1991. Just how much capital investment

is needed to minimize the Federal Government’s

long-term energy costs is speculative, but it appears

that a return to at least the level of the early 1980s

could be productively used.

For assisted households, funding is a similarly

large problem (see ch. 3). For example, a 1988 study

sponsored by HUD found a backlog of more than

$10 billion in safety, health, and efficiency-related

maintenance projects in public housing. Against that

need, HUD provided public housing authorities with

$1.5 billion in fiscal year 1989.

Similarly, the number of low-income households

eligible for the Department of Health and Human

Service’s (HHS) energy assistance program far

exceed the availability of funds for weatherization.

In fiscal year 1989, about 20 million households met

Federal eligibility requirements. However, only 6

million have been weatherized under both DOE’s

weatherization program and the Low Income Home

Energy Assistance Program’s (LIHEAP’s) weatherization funding even after nearly a decade of those

programs. The cost to weatherize the remaining

4D.J. AtWO@ Deputy s~ret~ of Defense, U.S. Department of Defense, memorandum to Secretaries of the Mlitary Deptiments and Dk~to~

of Defense Agencies, Mar. 13, 1991.

sNote @t some enern efficiency projects are often combined with major maintenance, so total efficiency Spending is higher than this indicates. For

example, when a roof needs repair, adding insulation is often part of the projw~ although the project is not labeled as an energy efficiency effort.

Similarly, when a boiler fails and is replaced, use of a high efllciency unit may be considered normal maintenance and not an efficiency investment.

%fiIhd E. Carr, office of the Secretary of Defense, personal communication Dec. 19, 1~-
92 ● Energy Efficiency in the Federal Government: Government by Good Example?

eligible homes can be roughly approximated at

$1,500 X 14 million = $20 billion. At current

appropriations rates, it would take decades to reach

this total. Furthermore, some of the measures

performed in weatherization, such as caulking and

weatherstripping, have limited (although long) lives

and will need to be repeated.

Shared energy savings (SES) and utility rebate

programs are possible private sector supplements to

the direct financing of Federal energy efficiency

measures.

7 So far, both together have contributed

only a small fraction of the direct Federal capital

investment in energy efficiency of the early 1980s.

Federal agencies are becoming increasingly familiar

with the SES approach, but implementation problems remain, and there have been few projects

during the past 5 years since authorization by

Congress. For example, even DOE still has not had

a SES project brought to completion, although

several DOE facilities have made attempts. In total,

only four projects had been implemented by the end

of 1990, representing a small fraction of the 6,000

major Federal facilities.

Where available, utility rebate programs can be a

useful supplement to Federal funds.8 The main

obstacle to use of utility rebate programs is the time

and availability of agency facility managers to learn

about and participate in the programs. Not all

utilities have programs, and for those that do, there

is a wide range of programs reflecting the capacity

and energy needs of the utility.

Virtually All Energy Efficiency Measures

Require Personnel

In addition to capital investment, most energy-and

cost-saving projects require a commitment of welltrained personnel.9 Personnel familiar with energy

efficiency opportunities are needed at all levels,

from the operations and maintenance staff at a

facility to the decisionmaking management of the

agency. As is the case with funding, personnel are

often in short supply.

Some opportunities such as performing regular,

high-quality maintenance of heating, ventilation,

and air-conditioning (HVAC) equipment cost little

more than a careful attention to detail. However,

attention to detail is not the default, but rather

requires vigilance and follow-through in design of a

program and in implementation. As noted in one

National Research Council report, “[i]n some Federal facilities, as in some private buildings, systems

receive almost no maintenance until something

serious goes wrong. In Federal agencies, inadequate

maintenance can be traced primarily to tight budgets

and unrealistic personnel ceilings." 10

A related issue is that increasingly over the past

decade, maintenance functions in Federal facilities

have been delegated to private contractors. In itself,

that poses no inherent problem. According to the

National Research Council, “most agencies have

found that maintenance contractors generally give

equal or better service than the government organizations they replace."11 While that shift reduces the

number of Federal operating and maintenance personnel needed, it does not eliminate them. For

example, ensuring that private contractors perform

high-quality, energy efficient operations and maintenance work on HVAC requires: 1) Federal HVAC

experts at facilities to design (e.g., write energy

efficient contract clauses), manage, and audit the

perforrnanceofwork;1213 and 2) sufficient operating

budgets to cover the costs of high-quality work.

Similarly, taking advantage of utility rebate

programs for energy efficiency measures also requires sufficient facility personnel to identify projects, negotiate the rebates, follow through on implementation, and monitor results. This is true even for

those utility programs which provide engineering

and implementation support, although those require

less Federal staffing.

7See ch. 2 for a discussion of the shared energy savings and utility rebate programs.

gFor a discussion of utiIity rebate programs, s= ch. 2.

%uilding Research Board, National Research Council, Policies and Criteria for Heating, Ventilating, and Air-Conditioning Systems in Federal

Buildings (WastigtoU DC: National Academy Press, 1990), pp. 31,33-35.

Wbid., p. 31

llIbid.

12Ro@d Stia “~pectig Maintenance Contractors, “ in Federal Construction Council, Technical Report No. 95: Maintenance of Mechanical

Systems in Buildings (VWshingtoq DC: NationaI Academy Press, 1990), pp. 29-31.

lsBuil&ng Rese~h Board, National Research Council, op. cit., footnote 9, pp. 32-33.
Chapter 6--Constraints on Increased Federal Energy Efficiency ● 93

Photo credit: Robin Roy

Despite constraints, many energy efficiency measures

have been implemented in Federal facilities over the

past 15 years. At the National Records Center at GSA’s

Suitland Complex, reflective window film both reduced

cooling loads and improved occupant comfort.

Many Federal Facilities Have No Energy Coordinator. Among the most important personnel for

identifying, implementing, and following through

on energy efficiency measures are energy coordinators at individual facilities or in regional offices. As

noted in chapter 3, the economic and technical

performance of most measures is site-specific.

Minimizing the risk while benefiting from available

commercial technologies requires a well-trained,

competent energy staff to determine which measures

are most likely to succeed. This staff expertise is

essential given that some poorly performin g products are always bound to be available along with the

good.

A comprehensive, systematic approach to minimizing energy use and spending requires personnel

dedicated to identifying, evaluating, and overseeing

the implementation of efficiency projects at each

major facility and monitoring performance. Energy

management is an area of expertise involving a

considerable degree of specialization in such fields

as mechanical and electrical engineering and economic and budgetary analysis. Several colleges and

professional associations have developed training

and certification programs for energy management

professionals (see ch. 2) which address these interdisciplinary issues.

Many Federal facilities have no explicit, trained

energy coordinator. This is another reflection of the

low priority placed on energy. Energy efficiency

projects, to the extent they are developed, are often

pursued in the spare time of facility staff. Typically,

this staff is charged with other critical missions, such

as maintaining and operating existing equipment.

Often, they have many additional projects which

they could pursue depending on priorities, ranging

from addressing environmental and safety hazards

such as transformers laden with PCBs and asbestos

floor tiles to planning for new facilities.

Further reflecting the low priority placed on

energy efficiency in recent years, the support for

energy coordinators has declined. For example, in a

1989 reorganization, the USPS eliminated its division and regional energy coordinators, rolling those

functions into other positions. The energy coordinator positions had been established in 1974, authorizing one energy coordinator for each USPS division

14 Another example of a

and two for each region.

shortage of Federal energy coordinators is at the

Army’s Fort Belvoir. That 3,000-building facility

has an authorized energy coordinator position, but

has had difficulty attracting and retaining candidates. At one point, the position was advertised as

available for 18 months before being filled, and one

coordinator remained on the job for only 1 year.15 In

part, that may be a result of the relatively low civil

service rating offered for this highly technical

engineering position. Private-sector energy managers are typically highly compensated engineers,

earning over $55,000 annually on average including

salary and bonuses according to the Association of

Energy Engineers’ 1990 salary survey.16 That exceeds the Federal Government’s GS-12 general pay

schedule which is common for energy coordinators.

In 1990, GS-12 pay ranged from under $36,000 to

under $46,571.

INFORMATION CONSTRAINTS

Prospects for Federal Energy Efficiency Have

Not Been Systematically Assessed

Information about potential and costs is basic for

determining the extent to which additional energy

efficiency efforts are worthwhile and for program

14wiIIim Eschma~ U.S. Postal Service, personal communication Sept. 12, 1990 and J~. 30, 1991.

15pa~ck Mc~u@, perso~ comm~catioq U.S. AmIy, FOfi Belvoir, Wt. 24, 19W.

lbAssoc~tion of Energy Engineers, “AEE Releases Results of 1990 Salary Survey,” Atlanta, GA, 1990.
94 . Energy Efficiency in the Federal Government: Government by Good Example?

planning. However, the Federal Energy Management Program has developed estimates of neither

the potential energy- and cost-savings nor the

capital and other resources required to attain

those savings in federally owned facilities. Similarly, none of the individual energy-using Federal

agencies contacted by OTA have produced such

estimates for their own facilities. The absence of

basic, governmentwide information of this type is a

serious shortcoming in current Federal energy management efforts.

Although building audits mandated under the

Energy Conservation Policy Act were conducted at

most major facilities in the past decade, the results

apparently were neither compiled nor analyzed,

much less kept current. The same is true of the

facility energy surveys mandated under the Federal

Energy Management Improvement Act of 1988.

In contrast to the lack of information for federally

owned facilities, HUD has produced estimates of the

potential energy- and cost-savings as well as the

investment required in HUD-assisted housing.17 HUD’s

study provides a basis for internal HUD planning as

well as for congressional budget requests.

The information collection and analyses required

in developing approximate estimates should not

pose too difficult a problem. However, analytically

accurate estimates are a moving target; as new

energy efficient technologies are developed, facilities are altered and their missions change, and prices

of energy go through often surprising gyrations. For

example, during the course of OTA’s study (July

1990 to April 1991), oil prices shot from $22 per

barrel to over $40 then fell below to $20. Any

estimates of the economic characteristics of an

oil-saving efficiency measure is highly dependent

on such price changes. Other energy prices have had

less drastic price changes over the past decade,

although forecasts have often been inaccurate (see

figure 6-3). Notably, electricity, the primary source

used in commercial buildings, has had relatively

minor cost variations.

The prospect of military base closures creates

some uncertainty about the opportunities for longFigure 6-3-Historical Energy Price Trends

25 $ per million Btus (nominal)

)

20-

15

1

10-

3 L 1

5 - ) $

< ) c

0 1 1 1 1 1 I

1980 1981 1982 1983 1984 1985 1986 1987

— Electricity ~ Natural gas + Dist. oil

~ Gasoline — Coal

SOURCE: U.S. Department or Energy, Energy Information Administration,

Household Energy Consumption 1987, DOE/EIA41321/1 (87)

(Washington, DC: U.S. Government Printing Office, October

1989).

term energy conservation investments in facilities

which may close.18 For example, an SES project

planned for Norton Air Force Base was canceled

following proposed closure of the base.19 In such

cases, total prospects for efficiency gains must

reflect both rapid payback opportunities and the

likelihood of continued facility operation.

Detailed energy audits of each of the Federal

Government’s 500,000 buildings and of all operations are not needed for program planning (although

audits of major facilities will be needed for comprehensive implementation). While the variety of facilities is great, a survey of a sample of them should

serve adequately for program planning and support.

Many Measures Have Uncertain Technical

and Economic Performance

Does this technology really work? Would the

facility be better off waiting for next year’s model,

which may have fewer bugs, cost less, and perform

better? Since many energy efficiency measures are

relatively new and not industry standard practice,

these are eminently reasonable questions. Using any

new technology entails some risk. No facility

ITAbt Associates, Inc., ‘‘Study of the Modernization Needs of the Public and Indian Housing Stock National, Regional and Field 0ff3ce Estimates:

Backlog of Modernization Needs,” U.S. Department of Housing and Urban Development, HUD-1130-PD~ March 1988.

Igmllmd Carr, U.S. Dep@ment of Defense, personal communicatio~ December 1990. Military base closures are conducted Waler tie~fe~

Authorization Amendments and Base Closure and Realignment Act, Public Law 100-526, Title II, Oct. 24, 1988.

lm.s. Department of Energy, “Annual Report to Congress on Federal Government Energy Management and Consewation Programs Fiscal Year

1989,” Oct. 3, 1990, p. 28.
Chapter 6--Constraints on Increased Federal Energy Efficiency ● 95

engineer wants complaints of inadequate lighting, or

of buildings too hot in summer and too cold in

winter. Nor do facility staff want to spend money

and time unnecessarily on unproductive measures.

There is no lack of technologies which fail to

perform as promised. It is likely that there will

always be some. Some measures merely provide less

energy and cost savings than anticipated, perhaps

not justifying the capital and manpower costs for

installation. For example, at least two of the Federal

facilities in OTA’s case studies had energy management and control systems (EMCS) which were

largely disabled and clearly not performing as

originally expected. The cost savings anticipated

when these systems were installed were not being

realized. On the other hand, the EMCS at one

facility, the Richmond Redevelopment and Housing

Authority, is performing better than planned in

saving energy, in part due to dedicated and innovative staff effort. In addition, through innovative use

of the monitoring capabilities, that system is also

providing unexpected benefits such reduced maintenance and repair workloads.

Even when technologies do perform as anticipated, it is often difficult to be sure of that due to

the lack of individual metering. For example, a

savings of 3 percent in a facility’s overall electric

bills can be difficult to distinguish from normal

month-to-month fluctuations in energy use, leading

to doubts about performance. This can be a particularly serious problem given the lack of detailed

metering at most facilities. Engineering estimates of

savings potential can be used in lieu of detailed,

metered data on energy use. However, calibrating

engineering models to actual performance is generally very difficult.

Potentially worse than either poor or uncertain

economic performance is actual product failure.

Some products have failed to perform their basic

function, not only wasting installation costs but

creating indirect costs as well. For example some of

the early electronic ballasts had a high failure rate,

burning out soon after installation. The result, for

those facility engineers who took the leap into the

technology, was a burden on maintenance crews and

lighting problems which could interfere with office

work. While the current generation of electronic

ballasts has proven itself in commercial application,

some facility managers have a lingering skepticism

and resistance to using them.

Apart from questions of risk in using new products, the question remains of whether future models

will perform better and cost less, and if so should

equipment replacement be delayed. For example,

should a public housing authority undertake a

program of early retirement for its oldest and least

efficient refrigerators? The best mass-produced models now available use only about half the electricity

of older models and may appear cost-effective as

early replacements. However, refrigerator efficiencies are expected to increase substantially over the

next few years. Under DOE’s proposed appliance

efficiency standards for 1993, refrigerators will be at

least 25 percent more efficient than today’s best

mass-produced units. If performance really does

improve that rapidly (or if costs decline as well), it

may be best to continue using an old inefficient

refrigerator for another few years before replacing it

with an even better model. Choosing the option with

the least life-cycle cost requires careful analysis and

forecasting of current and future energy prices, and

equipment price and performance.

Despite the wealth of diverse experiences with

energy management techniques in Federal facilities,

there appear to be relatively few formal demonstration programs to help sort out those programs which

work from the rest. Different agencies and individual facilities have tried a wide variety of energy

efficient measures, providing a potential wealth of

information. These experiences could help reduce

risk and improve the likelihood of success for further

Federal efforts. For example, what were the critical

features that allowed the USPS’s San Diego Division to successfully complete one of the few SES

contracts in the Federal Government, rather than

spending months on an unproductive effort? (See ch.

5.) Taking full advantage of the experiences provided by these efforts requires greater information

sharing and could also benefit from additional

analysis of existing Federal efforts. For example, the

quarterly FEMP Update is a useful interagency

information-sharing forum which could be expanded and made more frequent.

Federal Energy-Use Decisions Are Made

by Many Thousands of Individuals With

Diverse Perspectives and Responsibilities

Efforts to reduce Federal energy use and

spending have to address a wide and diverse

group of Federal employees and households receiving Federal energy assistance, a challenging
96 ● Energy Efficiency in the Federal Government: Government by Good Example?

task. An energy- and cost-saving effort requires

coordinating diverse information about engineering,

economics, and funding among a wide range of

personnel.

Nearly every Federal employee has some input

into energy-use decisions. Similarly, the millions of

people residing in assisted households have considerable influence over energy use. These individuals

decide when to turn on and off lights and office

equipment, whether to open windows, and how to

set the thermostat. For the vast majority of individuals, their energy-use decisions are small and individually insignificant, mattering only in the aggregate.

These employees and households use energy in

performing their jobs or in daily residential life. New

technologies such as lights controlled by motion

detectors in conference rooms and restrooms can

further reduce the importance of most individuals’

efforts. Often, these Federal employees have little

information about the aggregate impact of their

individual actions. One example of a dedicated

effort to raise energy awareness among all Federal

energy users is that of the U.S. Army in Europe.

There, innovative information campaigns are coupled with awards and other activities to inform

energy users in military housing as well as in offices

(see box 6-A).

A far smaller but still large number of Federal

employees have jobs more closely related to energy

use. There are three main groups:

● facilities engineers and their staffs;

. central and regional office energy offices; and

. field, regional, and central office management.

Typically, facility engineering personnel are responsible for operation and maintenance of one or

more buildings. Facility engineering personnel include operation and maintenance staffs, which may

include contractors as well as government employees. Efficient operation and maintenance of the main

energy uses of lighting and HVAC depended largely

on the performance of these personnel. Often, the

facility engineering staff is also responsible for

devising and implementing some energy efficiency

measures, particularly no, low, and moderate cost

projects.

All major Federal agencies have an energy office

of some type located in the central office or

headquarters. Regional offices also may have an

energy office. Some individual facilities also have

energy coordinators with the explicit function of

implementing energy efficiency measures, although

that appears not to be the norm. These energy offices

have explicit responsibility for disseminating information about energy- and cost-saving opportunities

and encouraging implementation of projects. Central and regional office staffs may also have responsibility for approving and prioritizing projects requested by field offices.

Once an energy- and cost-saving project has been

identified, decisions about whether or when to fund

it may involve many individuals in the agency’s

management. Often there is a complicated chain of

command between the facility engineers and the

agency management including facility directors,

budgeting and finance departments, policy offices,

up through political appointees who determine

funding and support for energy projects. This

management function requires balancing and trading

off between a host of often conflicting demands for

scarce resources facing the agency.

Figure 6-4 depicts the decisionmaking steps for

implementing energy projects at the Department of

Veterans Affairs. Note that line-item congressional

approval is necessary for high cost projects (i.e.,

over $3 million).

Two main challenges are raised by the large

number and diversity of parties involved in energyuse decisions. First, for many energy efficiency

projects, the activities of the diverse parties need to

be carefully coordinated to ensure that project

conception, design, budgeting, and implementation

all take place. Second, education and training about

the opportunities and performance of energy efficiency measures must be diverse, reflecting the

diverse information needs and perspectives. For

example, boiler operators and mechanics need to be

aware of the importance of maintenance programs,

as well as the specific mechanical steps required for

their boilers. Facility managers and agency management, on the other hand, need not know how boilers

and other equipment work. However, to make

appropriate manpower and budgeting decisions,

they need to be aware of the importance of energyrelated maintenance programs in minimizing operating costs of a facility.
Chapter 6--Constraints on Increased Federal Energy Efficiency ● 97

Box 6-A—Energy Program of the U.S. Army in Eurapel

The U.S. Army in Europe (USAREUR) has had an

energy program since 1975+ With over 25 pereent of

the Army’s personnel stationed across Europe, the

energy bill is significant. Thirty-one percent of USAREUR’S energy consumption is in mobility operations

and the remaining 69 percent in fixed facilities.

Through an aggressive energy program USAREUR

has reduced its facility energy consumption 46 percent

on a Btu/square feet basis since 1975. In dollar terms,

this amounts to cumulative cost avoidance of $934

million since 1980.

The energy program is comprehensive, establishing

an energy chain of command. Goals are set for energy

components, such as lighting and heating and cooling;

awards are presented; monthly energy letters are

widely distributed, and a biannual publication of

“Good Ideas,” containing all efforts implemented

around the communities, is also distributed.

The energy awards program recognizes both small

and large communities for saving energy in a variety

of categories, The strenuous review of the nominees

includes scoring ort elements like efficiency measures,

shmt-term measures, long-term plans, numeric performance, mobility fuel savings, special considerations, and a day-long site visit of the finalists. The

value of the awards program is multifold It shows

interest and cornrwkxnent of USAREUR, creates interest and publicity for the energy program, recognizes

deserving cmnmnities, and reduces enwgy use. Prior

to fiscal year 1991, the recognition included a monetary award, $5Q0,000 for fiist place and a total of $1.2

million in cash awards to be used on a welfare, morale,

and recreation item for the communities’ benefits.

The ‘Good Ideas” energy guide contains measures

that wme impkxrmted at ail levels of the community.

Schoolchildren participated in an adopt-a-lightswitch

program, one community sponsored an energy rapper

contest to involve young soldiers, numerous communities implemented retrofits on their lighting system,

and at Heidelhrg the batailion has 1 hour of martdatory energy training rnorlthly. In ti there were over

400 ideas implerneritedby the engineering department,

the community, aad the command,

The energy program in USAREUR is a model to be

replicated throughout the armed services. During

congxessiona.1 hearings in the swmner of 1990, Jeffrey

Jones, Director for Energy Policy, stated:

k 1989, the ~~tl~ Secretary of ~fmse requested

that the Defense components take a closer look at such

incentives and suggested that the concept be applied

Department-wide. Unfwtunately this coincided with

a reduction in operations and maintenance funds

which would be used to provide such incentives. We

are currently reviewing the Department’s overall

conservation program and the methods for instituting

tangible incentive programs.2

***

USAREUR ENERGY PROGRAM

Raising awareness ofenergy use is one facet of the

comprehensive ermrgy conservation programfor the

U.S. Army-tEIxope.

@fo~ion IMS@ On COL Rdwrt Fear, U.S. Army, letter to 0E4 and attachments, ~. 5, 19W+

Z3e~W A. $onW, D~tor for Em poli~y, Offke of Secretary of Defense, testimony at jotith- on Fed~ ~WN use ~ ‘~~

Facilities, before the House Mmmrnittoe on Energy and Power of the Committee on Energy and Commerce and the House Subcommittee cm

Envircmmen4 Energy and Natural Resources of the Committee on Government Operations, July 11, 1990, p. 5.
98 ● Energy Efficiency in the Federal Government: Government by Good Example?

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— — — — — - — — — - — — — — — -—

t

1

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Chapter 6---Constraints on Increased Federal Energy Efficiency ● 99

LACK OF INCENTIVES

There Have Been Few Rewards for

Efficiency and Penalties for Waste

Incentives can either reward desired behavior or

penalize undesired behavior. Neither carrots nor

sticks have been widely and systematically used in

the Federal Government to promote energy efficiency. There are notable exceptions, but generally,

facility managers have neither rewarded nor penalized staffs for their energy efficiency performance;

regional and headquarters offices neither rewarded

nor penalized facilities; and Congress neither rewarded nor penalized agencies.

What happens if an individual facility does not

pursue efficient measures for energy and cost

savings? Usually, not much. Energy budgets are

generally based on previous years’ expenditures.

That is necessary since, with existing information, it

is difficult for budget analysts in an agency’s

headquarters to know whether energy use and

spending is wasteful (see ‘‘Prospects for Federal

Energy Efficiency Have Not Been Systematically

Assessed,” above). Even if energy bills increase

dramatically, central offices often have little choice

but to allow the additional funds given their lack of

detailed information. Dramatic but apparently reasonable increases in spending do occur. For example, the Washington, DC, VA Hospital had a more

than fivefold increase in spending on purchased

steam in the late 1980s. This increase resulted from

a new pricing and accounting method used by the

neighboring hospital, seller of the steam.20 While

entirely unanticipated, the VA had no real choice but

to provide additional needed funds to the facility.

Determining g whether the new higher prices justify

substantial improvements in the efficiency of the

VA Hospital’s steam use is largely beyond the

resources of the central office staff. Again, the lack

of detailed central office attention reflects the

understandably low priority of energy efficiency. A

penalty, particularly one which is misapplied, is

likely to restrict a facility’s ability to perform its

basic mission, an intolerable outcome.

Many agencies’ headquarters or regional energy

offices set targets for energy use at facilities to

promote the long-term, energy-reduction goal required by the Federal Energy Management Improvement Act (see ch. 2). But again, since there is no

systematic auditing of facilities’ spending on energy

nor the opportunities for savings, these goals are

somewhat arbitrary and not backed up by penalties.

Similarly, when the 20-percent reduction goal from

Executive Order 12003 lapsed unmet in 1985, there

were no apparent penalties.

What are the penalties if an agency overall does

not pursue efficient measures? The answer is much

the same as for the individual facility. Congressional

committees have neither the information nor the

time to determine in detail the specific wasteful uses

of energy by Federal agencies, and are not likely to

tolerate restricting a agency’s ability to perform its

basic mission.

What are the rewards for agencies and personnel

that aggressively attain energy- and cost-savings?

The National Defense Authorization Act for fiscal

year 1991 allowing military base commanders to

retain two-thirds of the savings generated from

shared energy savings programs are a notable

example of an explicit, direct incentive (see ch. 2).

The U.S. Army in Europe has had a several-year

effort to create energy conservation incentives for

the military families housed there (see box 6-A).

Another example is the monetary incentive program

developed by the National Capital Region of the

General Services Administration for its facility

personnel (see box 6-B). 21

More typical, however, has been a lack of direct

incentives. Utility accounts are separate items in

facility budgets: any savings in utility spending is

realized by the regional or central office rather than

the facility manager. Similarly, field personnel (e.g.,

boiler operators and maintenance crews) do not

typically receive awards based on energy savings.

There may be some indirect incentive at all levels

expressed through performance reviews and promotion opportunities. For example, minimizing energy

costs is one way a facility manager can meet overall

budget goals, which may be part of the incentive

~Mmk Butcher, Assistant Chief of Engineering, Washington VA Hospital, persod COmmUniCatiOIL Sept. 19, 19~.

ZI~e GSA aw~d pro~m is one Pti of an ktemive carnpaig which includes access to fimding for efficiency measures and _ and edu=tion

about new energy efficient products.
100 . Energy Efficiency in the Federal Government: Government by Good Example?

Box 6-B--General Services Adnzinistr@”on Memorandum Sent to All District and

Buildings Mtmagers in the National Capital Region

Fiscal Year 89 Energy Efllciency Awards

Continued efforts to save ener~ in Federal buildings is a top priority for the Buildings Management Division

(BMD) in fiscal year 1989 and through 1995 in order to meet the 10-percent energy reduction goal, as mandated

by the Federal Energy Management Improvement Act of 1988.

As in fiscal year 1988, BMD will recognize accomplishments of increased energy conservation for fiscal year

1989 through the Energy Eft%ciency Award Program to the field offices which demonstrate the greatest progress

in conserving energy. Similar to last year, a field office must conserve at least 2 percent in energy consumption,

over the previous year, to be considered for the award.

For the fiscal year 1989 awards, cost savings of at least $1 million, by the Region, will warrant a 5 percent

distribution to the winning field offices. Therefore, the maximum cash disbursement for the region would be

$50,000. A minimum savings of $200,000 is required in order for the Region to provide Energy Efficiency Awards,

with a cash disbursement of $10,000 to the winning field offices.

Hopefully, this will chaIlenge each and every manager to achieve as much energy savings as possible and

partake in tlw $50,000 maximum disbursement for this fiscal year.

SOURCE: Jack E. Babeoc~ Director, Buildings Management Divisiom Gene@ Services AWs@ati~n N@io~ ~P~~ Re@onl

memorandum to Dislrict and Building Managers on Fiscal Year 89 Energy Efficiency Awards, Mar, 30, 1989.

package. These incentives, while potentially valuable, are indirect and diluted.

Procurement Policies Are Challenging22

Federal procurement policies are often cumbersome and confusing when applied to energy efficiency measures.

23 Difficulties of identifying novel

energy-efficient products and services are a built-in

disincentive to change. The Federal Government

procures a great variety of energy-related goods and

services, and procurement policies are correspondingly diverse. For example, procurement policy

determines how gas and electric utility service is

obtained, whether and how facilities contract out

their HVAC system operating and maintenance

services, which commonly used items such as lamps

and refrigerators are available through the Federal

Supply System, and what economic analysis methods are used to trade off long-term savings against

initial costs for a new refrigeration unit.

Two main challenges are raised by procurement

policy. First, for some commonly used items

available through Federal Supply System, there

is little information comparing their life-cycle

energy and economic characteristics. For example, the GSA-authorized contract schedules for

emergency exit signs do not give a clear, unbiased

assessment of the performance and savings to be

expected when using light-emitting diode signs

instead of standard incandescent signs, both of

which are available.24 Similarly, facility engineers

are given little information about the performance of

lamps, which are supplied by DOD’s Defense

Logistics Agency. In contrast, GSA’s Household

Appliances Schedule, which includes products such

as refrigerators, water heaters, and room air conditioners, lists only the lowest life-cycle cost items.

Often, the only information on product performance is that provided by the vendors. A purchaser

must be previously aware of the opportunities for

energy savings, and be willing to dedicate time and

effort to learning about the alternative products. In

absence of awareness, time, and effort, purchasers

may be expected to continue to use standard

replacement products. This challenge is particularly important since the supply system includes

many inefficient products.

Second, Federal procurement methods are

complex, potentially resulting in a cumbersome

or confusing process which can impede use of

novel goods and service contracts. Federal procurement is naturally complex, reflecting the diverse

Zzsee Ch. 2 for an overview of procurement.

zsAt least, t~t is how it is described by many of the Federal workers with whom OTA s~f met.

resee ~ox 3.A ti Ch. 3 on eXit Signs.
Chapter 6--Constraints on Increased Federal Energy Efficiency ● 101

goals of the process. While the foremost goals are Complex procurement policies may even have

“economy, efficiency and effectiveness,’ also in- hindered Federal facilities from participating in

eluded are socioeconomic development (e.g., for utility rebate and incentive programs which encoursmall, disadvantaged businesses),25 and efforts to age use of high efficiency equipment and methods

promote competition and to protect against fraud (see ch. 2). While Federal acquisition regulations

and abuse. Together with the diversity of products appear to include no specific Prohibitions against

and services noted above, the result is a complex

system. The small number of Federal SES contracts

to date is one example of contracting difficulties

raised by procurement policies. As noted in chapter

2, SES has been slow to develop in part due to the

challenge of developing an acceptable contract and

due to the lack of service companies willing to

respond to complex Federal proposals.

participation in such utility programs, there are no

specific allowances either to accept what might be

construed as a gift. To clarify that Federal participation in

national

included

DOD. 27

utility programs is

interest, in 1990

language to that

indeed legal and in the

Congress specifically

effect for GSA26 and

~See 48 CFR 19 (Oct. 1, 1983).

zGTreas~, Posti SeNice and General Appropriations Act, 1991, I%blic hw 101-509, Sec. 15.

27Natio~ Defense Authorization Act for FY 1991 (NDAA), F%blic hW 101-510, Sec. 2851.
Policy

for

Issues and

Improving

Chapter 7

Options

Federal

Energy Efficiency
Contents

Page

CONGRESSIONAL INTERESTS IN FEDERAL ENERGY EFFICIENCY . . . . . . . . . . 105

Demonstrating Efficient Measures Useful in the Private Sector . . . . . . . . . . . . . . . . . . . . 105

Supporting Markets for Suppliers of Efficient Products and Services . . . . . . . . . . . . . . 105

Providing a Firsthand Basis for National Energy Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . 106

Reducing Federal Spending . . . . . . . . . . . . . . +... . . . . . . . . . . . ● ” ● 106

Reducing Energy-Related Environmental, Health, and Security Costs .. .... .... . 106

POLICY OPTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . .,.. . ............... . 107

Maintaining the Status Quo: Present Trends in Federal Energy Management . . . . . . . 107

Dedicating Funds and Staff . . . . . .... . . . . ● . . . . . . . . . ...... . . . . . . . . ● ● . ● . 108

Encouraging Agency Efforts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110

Promoting Research, Development, and Demonstration . . .. ........ ● . . . . . . . . . . . . 112

Box

Box Page

7-A. The Texas LoanSTAR Program: A $98-Million Conservation Fund for

Government Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109

Table

Table Page

7-1, Policy Options for Federal Energy Efficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
Chapter 7

Policy Issues and Options for

Improving Federal Energy Efficiency

Despite the wide array of programs which have

been developed over the past 15 years, the Federal

Government still has many opportunities to improve

energy efficiency in its facilities and operations

using commercially available, cost-effective measures. Just as there is no single constraint explaining

the failure to harness many opportunities, there is no

single, simple policy that will ensure the greatest use

of energy efficiency measures in the Federal Government. Fortunately, none of the constraints are

fundamental obstacles; rather, all can be addressed

by a variety of new and existing initiatives. In fact,

many new initiatives may involve simply making

widespread use of the best practices already found in

some Federal facilities and operations today. Still,

taking full advantage of existing opportunities will

require a higher priority for energy efficiency as

reflected in adequate investment funding and staffing.

This chapter frost summarizes the variety of

benefits that improved Federal energy efficiency

could bring to the government and to the Nation as

a whole. The second part describes a range of policy

options which Congress could consider for enhancing current efforts if it views the benefits of

improving Federal energy efficiency as worth pursuing more completely.

CONGRESSIONAL INTERESTS IN

FEDERAL ENERGY EFFICIENCY

There are good reasons for Congress’ continuing

interest in Federal energy efficiency. The potential

benefits of improved efficiency include:

1.

2.

3.

demonstrating energy efficient measures useful

throughout the economy, not just in the Federal

Government;

supporting markets for suppliers of efficient

products and services;

learning firsthand which approaches work as a

basis for national policy (e.g., while the Federal

Government is not entirely analogous to the

private sector, many of the constraints on

Federal energy efficiency and their solutions

may pertain to the private sector);

4. reducing Federal spending without reducing

services; and

5. reducing energy-related environmental and security problems.

While the benefits of improved Federal energy

efficiency can be great, there are costs as well. The

effort involved can be considerable, in particular

requiring initial capital investment and staffing and

the attention of Congress and senior executive

branch personnel.

Demonstrating Efficient Measures Useful

in the Private Sector

Federal demonstration can bean effective tool for

promoting energy efficiency in the private sector.

The Federal Government has broad experience using

electricity, natural gas, petroleum products, and

other energy sources in housing, office buildings,

hospitals, transport, and other facilities and operations. From lighting to heating, ventilation and

air-conditioning (HVAC) equipment to automobiles, the Federal Government has an opportunity to

set a good example for energy efficiency while

demonstrating the use of a wide range of measures.

By demonstrating the cost and performance of

energy efficient technologies and operating strategies in its own facilities and operations, the Federal

Government could help reduce the risk and uncertainty that private-sector managers perceive when

considering these measures for their own facilities.

This demonstration should encourage greater privatesector adoption, as noted by several respondents to

one survey on Department of Energy (DOE) conservation research and development (R&D) programs. 1

Supporting Markets for Suppliers of Efficient

Products and Services

A second way that Federal use of efficient goods

and services can spill over into the private sector is

by accelerating development of more efficient prodl~e Mliance to Save Energy, ‘‘The Department of Energy’s Conservation R&D Programs: Results of a Survey of Industry Leaders,” Washington

DC, March 1989, pp. 5,7, 9-11.

–l05–
106 . Energy Efficiency in the Federal Government: Government by Good Example?

ucts by manufacturers. By virtue of being such a

large consumer of energy-using goods and services,

the Federal Government helps define the market

which manufacturers aim to serve. For example,

about 1 percent of new domestic automobiles and

light trucks are purchased by the Federal Government. Similarly, around 10 percent of residential

appliances are used in federally assisted or owned

households (although nearly all are purchased privately, not by the government). By supporting the

use of the most cost-effective energy efficient

products, Federal purchasing power can promote

earlier introduction of high efficiency technologies.

Some utilities are working on a similar approach

(sometimes called the “golden carrot”), which

would be aided by Federal procurement. For example, Pacific Gas & Electric Co. and other utilities

will offer $300 rebates for refrigerators which

exceed the National Appliance Energy Conservation

Act standards for 1993 by at least 25 percent. The

aim is to ‘‘accelerate introduction of such refrigerators by several years. ”2

Providing a Firsthand Basis for

National Energy Policy

There is a clear government interest in promoting

energy efficiency throughout the economy reflected

in a wide range of both legislation and executive

agency activities (e.g., DOE’s Office of Conservation and Renewable Energy). Federal experiences

with in-house energy management can provide

useful policy insights into energy efficiency policies

for the private sector since many of the constraints

on Federal energy efficiency also apply in the private

sector. For example, many private-sector institutions have funding and staffing constraints which

effect their energy efficiency prospects. Similarly, a

lack of information on the technical and economic

performance of energy efficiency measures exists in

the private sector as well as in the Federal Government. While the Federal Government is not completely analogous to the private sector, Federal

experiences may be useful in developing broader

national energy efficiency policies.

Reducing Federal Spending

There is a clear Federal interest in ensuring that

government services are performed efficiently to

minimize spending. Many energy efficiency measures are available which, if employed, would reduce

the cost of government. There are no comprehensive

analyses of the potential for savings, but as described

in chapter 3, highly cost-effective opportunities in

federally owned facilities could total on the order of

at least $1 billion annually. These total potential

savings dwarf in comparison with the total Federal

spending (which for fiscal year 1989 was $1.1

trillion), but are a larger fraction of discretionary

spending (about $300 billion) 3 and of the deficit

(about $160 billion in fiscal year 1989).4 While not

a panacea for eliminating the Federal deficit, energy

efficiency measures can produce considerable savings while requiring no reductions in government

programs. Also, many measures are well-understood

and relatively risk-free methods of reducing spending.

On the negative side, most energy- and costsaving measures require an investment of capital or

personnel. Although for many efficiency measures,

cost savings within the first 3 years (and in some

cases, within the first year) more than recover any

initial investment, funding and personnel resources

are essential. These resources are typically scarce in

Federal agencies. The return on investment of many

measures is excellent, far higher than the Treasury’s

cost of funds, but that does not ensure availability of

Federal funding. Besides requiring initial funding

and personnel, pursuing fuller implementation of

efficiency measures requires the time and attention

of agency management, which is also typically

scarce.

Reducing Energy-Related Environmental,

Health, and Security Costs

In addition to the direct economic savings,

increased energy efficiency has indirect environmental, health, and security benefits. This is true of

federally purchased energy as well as energy used in

the private sector. Energy production and use are

leading factors in many environmental issues facing

%Xterfrom Mason WillriciL Pacflc Gas & Electric Enterprises, Mar. 25, 1991.

3u.s. Bureau of the census, StatMcaZAbstract of the UnitedStates: 1990, 1 loth ed. (Washington, DC: 1990), table 502. ~s includes oudays which

can be increased or decreased by Presidential decisions, and require no change in existing Federal laws. For example, this list does not include Social

Security, Medicare, and prior year contracts and obligations.

d~id., table 497. Includes off-budget receipts, outlays, and transactions as defined by OffIce of Management and Budget.
Chapter 7--Policy Issues and Options for Improving Federal Energy Efficiency ● 107

the Nation such as urban ozone, acid rain, and

potential climate changes Similarly, energy production and use are contributors to some health problems ranging from respiratory disease related to

particulate and sulfur oxides6 to still speculative

concerns such as the biological effects of electric and

magnetic fields.7 While the actual health and welfare

costs to society are not fully understood for these

environmental impacts, Congress devotes considerable effort to addressing them. Dependence on

foreign fuels also raises concerns about energy

security which may have profound policy implications. 8 Increased Federal energy efficiency and the

spillover into improved private-sector efficiency can

help reduce these indirect costs.9

POLICY OPTIONS

Ongoing support for existing Federal programs is

essential in promoting Federal energy efficiency.

These programs provide the framework for future

energy-and cost-savings efforts, even though today

they are not implemented thoroughly. The current

level of support may be sufficient to maintain the

framework but is inadequate for realizing the full

potential of cost-effective, energy-saving measures

and for setting an example for supporting privatesector efforts.

There are several options Congress could consider

if it views improved Federal energy efficiency as

worth pursuing more vigorously (see table 7-l). All

could help improve Federal energy efficiency. Some

measures, such as revising procurement policies and

creating monetary incentives for agency personnel,

require modest or negligible initial costs. However,

realizing the full potential will require the investment of funds and staffing.

Table 7-l—Policy Options for Federal

Energy Efficiency

Maintaining the status quo

Dedicating resources

Increasing funds for investment

Supporting an adequate staff

Encouraging agency efforts

Setting standards for performance

Rewarding agencies and individuals for energy and cost

savings

Revising procurement: information, life-cycle costing, and

simplification

Following through and enforcing

Promoting research, development, and demonstration

SOURCE: Office of Technology Assessment, 1991.

Maintaining the Status Quo: Present Trends

in Federal Energy Management

Over the past 16 years, Congress and the executive branch have developed a wide range of programs promoting energy efficiency within the Federal Government, as described in chapter 2. These

programs have been effective to some degree,

helping to save a total of about $7 billion (about

5 percent of Federal energy spending) in Federal

buildings and operations between 1975 and 1989.10

However, implementation efforts for Federal energy

management waned during the 1980s, as indicated

by an 80-percent drop in capital investment for

conservation measures between fiscal year 1981 and

1989. (Adjusting for inflation, $300 million in 1981

would be over $450 million in 1991 dollars.) That

declining trend has reversed beginning in fiscal year

1990, although funding levels are still low. In fiscal

year 1990, funding has increased slightly to about

$50 million, which is still far less than the $300

million invested in 1981. For fiscal year 1991, DOD

and GSA alone have increased planned energy

efficiency investments to $40 million.

Ssee, for ~mple, U.S. ConWess, ~fice of Tec~ology Assessmen~ Catching Our Breath: Next Srepsfor Reducing Urhn Ozones OTA-0_412

(Washington, DC: U.S. Government Printing Office, June 1989); and U.S. Congress, 0fi3ce of Technology Assessment Changing by Degrees: Steps

To Reduce Greenhouse Gases, OTA-()-482 (Washington, DC: U.S. Government Printing Office, February 1991).

Ssee U.S. EnvironrnenM Protection Agency, Office Of Air ~d Radiatiom “Regulatory Impact Analysis on the National Ambient Air Quality

Standards for SuLfur Oxides (Sulfur Dioxide),” draft, May 1987, ch. 6 and 7.

~or example, see U.S. Congress, Office of Teebnology Assessmen~ Biological Efects of Power Freguency EZecm”c and Magnetic

Fields+ackground Paper, OTA-BP-E-53 (Washington, DC: U.S. Government Printing Office, May 1989).

gsee u.S. con~ss, oftlce of Technology Assessmen~ Oil Replacement Capability, foficoming, 1991.

*or example, as part of a pollution prevention strategy to reduce emissions of SOZ, the Clean Air Act Amendments of 1990 specifically encourages

utilities to use conservation and renewable energy. Public Law 101-549, Title IV, Section 404F, Nov. 15, 1990.

1% addition to Fede~ progr~s, an overall improvement in tbe eftlciency of appliances and equipment being manufactured t~y contributes to

Federal energy savings. For example, even an average new refi-igerator or air conditioner is far more efficient tban the average 15-year-old model it

replaces.
108 ● Energy Efficiency in the Federal Government: Government by Good Example?

In addition to funds for capital investment,

funding for interagency coordination, training, information sharing, and analysis of governmentwide

opportunities has been increased by over two-thirds

in fiscal year 1991 to $3 million. These activities,

which are performed by the Federal Energy Management Program (FEMP), are useful for improving

Federal energy efficiency at as low a cost as possible

(see ch. 2). The higher level of funding is intended

to support increased governmentwide coordination

and analysis. OTA did not analyze how effectively

FEMP uses its current funding for interagency

coordination and analysis of, and support for,

governmentwide opportunities. Therefore, it intends

n. suggestion as to whether the FEMP budget would

benefit from further increases, or whether less

important activities could be cut back, or whether

useful activities could be absorbed within the

existing budget by simply increasing managerial

efficiency.

Current Federal efforts together with a general

improvement in the efficiency of HVAC and lighting equipment on the market should help to gradually improve Federal energy efficiency. However,

the improvements will be far smaller than is

economically attractive. For example, there are

probably a few billion dollars worth of highly

cost-effective energy efficiency investment opportunities (e.g., with returns on investment of 25 percent

or more) in federally owned buildings alone, and

another few billion dollars worth in federally assisted housing (see ch. 3). At the current low level of

energy efficiency funding and staffing for individual

agencies, it would take several decades to make all

the economically attractive investments. During that

time, tens of billions of dollars would be unnecessarily spent to buy inefficiently used energy.

Dedicating Funds and Staff

Increasing Funds for Investment

Funding for conservation investments is essential

for many energy- and cost-saving opportunities.

There are several billion dollars worth of highly

cost-effective energy-efficiency investment opportunities in federally owned and assisted buildings, as noted above. Many of these measures have

very high returns on investment, several times

higher than the Treasury’s cost of funds. For

example, an investment replacing existing lowefficiency magnetic ballasts and fluorescent tubes

with high-efficiency tubes and perhaps electronic

ballasts may produce an annual return on investment

of 30 percent or more (one utility-assisted lighting

retrofit at the U.S. Postal Service San Diego

Division has an annual return on investment of over

380 percent). (See ch. 2.) In comparison, the

Treasury’s current cost of funds is nominally about

6 to 8 percent.11 Thus, if new Treasury obligations

were used to fund efficiency investments, savings in

energy costs could greatly exceed interest on the

new debt.

Precisely how much additional investment would

be productive and over what time frame? It appears

that an increase in Federal investment at least to

the level of the early 1980s, during which a few

hundred million dollars were available annually,

could produce very high returns for the foreseeable future. Even greater funding may also be

useful, although Federal agencies have not comprehensively assessed the extent of existing opportunities,

and the precise amount is uncertain (see ch. 3). As

one step to ensuring appropriate funding, FEMP

could be required to provide estimates of the

governmentwide potential energy and cost savings and the capital investment required to attain

those savings in its annual report to Congress.

The source of energy investment funds and the

best way to administer them are critical issues. As an

alternative to having each agency obtain its investment funds through its budget requests and appropriations, Congress could consider establishing a

governmentwide revolving fund for Federal energy efficiency projects. The LoanSTAR program

in the State of Texas provides one example of how

such a governmental energy efficiency fund can

work (see box 7-A). Based on the high returns on

investment for many efficiency measures, a fund

based on new Treasury obligations could be entirely

self-supporting. As another alternative, a fund could

be raised by placing a surcharge on energy spending

in federally owned buildings. For example, a surcharge of under 3 percent would generate a $100

million fired in 1 year.

1lAS of Feb. 20, 1991, so-day Treasury bills have a nominal interest rate of about 6 percent; 30-year Treasq bonds currently yield about 8 Pement.
Chapter 7---Policy Issues and Options for Improving Federal Energy Efficiency ● 109

1

Box 7-A—The Texas LoanSTAR Program: A $98-Million Conservation Fund

for Government BuildingsJ

The T@xas LoanSTAR program is a $98.6-million, 8-year, statewide energy conservation program established

in 1988. It offers loans of up to 4 years in length to public-sector institutions in Texas, including State agencies,

heal gmwxmmmts, univwsities, and schools. Initial capital for the program came from oil overcharge funds.

To securea loan, abuikiing is first given an ertergy audit to identify potential retrofit projects. Projcmts compete

for funds on the following criteria: estimated payback ability to repay the loan through energy savings, engineering

asswsrnmt of the project, and the feasibility of effectively metering the project. The maximum loan for a State

agency or university is $4.8 million, while the maximum for a local government or school district is $$.2 million.

Repayments are made semiannually tit a 4,#-percent interest rate.

A monitoring and analysis program @AP) is a central component of hxmST~. Monitoring and analysis of

energy usage patterns helps identify changes in operation and maintenance that may result in substantial savings.

Also, MAP compares the actual savings of completed retrofits to the estimated savings to help program managers

determine which measures to weed out so that unsuccessful ones will not be repeated elsewhere.

11’’~~Gov~I@~ Ener@ hmlagernent Center, “Texas State Energy Conservation Plan an.dEnergy Extension Service Combined Grant

Application” Jme W%), pp. 72-91; and Malcolm Verdict et al., ‘‘Monitoring $98 Million in Energy EfilcierltR@ofits, the Texas I.oanS’IAR

Progrw” paper presemtedat the American Council for an Etwrgy-Efllcient Economy 1990 Summer Study on Energy IMi3ckmey in Buildirws,

AstionMx, C!A, Aug. 26-Sept. 1, 1990.

Supporting an Adequate Staff

Adequate funding alone is not enough to produce

the greatest energy and cost savings for the Federal

Government. It is at least as important to have a

trained, competent, and motivated staff at individual Federal facilities, and in central and

regional offices, dedicated to successful implementation of energy saving measures. Minimizing

risks while benefiting from commercial or forthcoming technologies requires a well-trained, competent

energy staff including engineers to determine which

measures are most likely to succeed. Staff expertise

is essential given that the applicability of many

measures is site-specific and that some poorly

performing products are always bound to be available along with the good.

Many energy efficiency opportunities require

qualified facility personnel but not Federal investment funds. For example, a program such as shared

energy savings (SES) contracting (see ch. 2) which

relies on private-sector funds requires staff with

expertise in energy-related engineering, finance,

economics, and contracting, not Federal funds for

investment. Similarly, participation in utility programs, even those which provide technical and

implementation assistance, requires the dedicated

attention of facility personnel familiar with the

facility’s needs and opportunities. As another example, efficient operation and maintenance of HVAC

equipment requires professional, trained technicians

(whether Federal employees or through contractors),

not capital investment.

Agencywide or governmentwide support programs can also effectively supplement special or

occasional needs of facility personnel. For example,

the technical expertise provided by the mobil energy

laboratories (MELs) sponsored by FEMP (see ch. 2)

can work with facility personnel to identify energy

efficiency measures, perform technical and economic analyses, and assist with implementation.

Similarly, the facility energy surveys performed by

the Army Corps of Engineers and the efficiency

programs developed by the Naval Facilities Engineering Command are but two examples of important regional and central office supplements to the

efforts of personnel at individual facilities. These,

too, require adequate staffing. For example, there are

only four MELs, a small number considering the

thousands of Federal facilities.

As one step to ensuring that appropriate staffing

is receiving adequate priority at individual agencies,

Congress could require the agencies, the Office of

Personnel Management, and FEMP to report on

agency staffing issues in FEMP’s annual report

on Federal energy management. This discussion

could include basic information on the qualifications

and number of energy-related staff (particularly

energy coordinators at facilities), an analysis of the
110 . Energy Efficiency in the Federal Government: Government by Good Example?

adequacy of current staffing to the broad range of

efficiency programs currently being pursued, and an

analysis of the ability to recruit and retain staff that

considers factors such as pay differentials between

the private sector and the Federal Government.

DOE’s experience in applying energy efficiency

measures outside the Federal Government could

also supplement agency efforts. For example, DOE’s

Institutional Conservation Program has assisted

energy efficiency efforts in public and nonprofit

hospitals and schools for over a decade. Some of the

lessons learned by headquarters and field office

personnel could be useful in implementing energy

efficiency programs in Federal hospitals and

schools.

Encouraging Agency Efforts

Setting Standards for Performance

Some existing standards for energy efficiency

could be expanded. Federal agencies currently face

at least four standards for energy efficiency (these

are described in ch. 2). One standard is the use of

life-cycle costs in designing new Federal buildings

and in comparing investments in alternative building

systems, described in the previous section. A second

standard is a mandatory design criterion for new

Federal buildings. This state-of-the-art standard was

developed over the past decade by DOE, the

American Society of Heating, Refrigerating and

Air-Conditioning Engineers, and the Illumination

Engineering Society.

Third, nationwide standards specifying minimum

efficiencies for household appliances and ballasts

indirectly benefit Federal facilities as they purchase

new equipment, just as national standards for

automobile efficiency effect the Federal fleet. New

national standards, for example for lamps, could be

considered which would indirectly result in further

efficiency improvements at Federal facilities.

Similarly, the Federal vehicle fleet is required to

meet the corporate average fleet economy (CAFE)

standard. Currently, the Federal fleet outperforms

that standard by 7 percent. Still, Congress could

consider strengthening the Federal fleet standard to

require outperforming the CAFE requirement by a

larger amount.

A fourth standard facing Federal agencies for their

existing buildings is a requirement that energy

consumption be reduced by 10 percent by 1995

relative to 1985.12 That requirement, enacted by

Congress in 1988, filled the void left when the

energy-saving goals set forth in Executive Order

12003 lapsed in 1985. Extending this requirement

beyond 1995 together with anew minimum savings

target could help promote greater continuity in

Federal energy efforts. Also, the standard could be

expanded to include energy used in operations. This

type of standard based on a percentage reduction

goal is relatively simple to understand and to keep

track of, making it a useful tool.13 A key issue is the

appropriate targets to set.

The Executive Order signed on April 17, 1991

sets a reduction target for Federal buildings of 20

percent by the year 2000 relative to 1985. It also

specifies a target of reducing 10 percent of the

gasoline and diesel fuel used in certain Federal

passenger vehicle and light truck fleets. These

targets provide valuable guidance to the agencies.

However, they are not based on an analysis of

existing opportunities and could potentially be

strengthened. Congress could direct DOE to perform

a life-cycle cost analysis of energy efficiency

opportunities for a sample of Federal facilities and

operations as a basis for setting a target. 14 The

number of facilities surveyed and the acceptable

level of detail and accuracy need to be balanced

against the cost and time required.

Revising Procurement: Information, Life-Cycle

Costing, and Simplification

Some Federal procurement policies could be

revised to encourage greater use of energy efficient

products and services. One possible procurement

change is to improve information on energy-using

goods provided to agencies through the Federal

Supply Schedule and Supply Catalog programs

managed by GSA and the Defense Logistics

Agency (see ch. 2). Currently the supply schedules

and the GSA Supply Catalog provide little or no

12~~meof~~n~disnot ~quet.the Fe&~ @vernment. For example, New York’s Executive Order 132, sign~ JruI. 2, l~Q fiec~ S@te

agencies to reduce energy consumption in both buildings and operations by 20 percent in the year 2000 relative to 1990.

13~ere me some Compficatiom even ~th ~s s~ple s~d~d. For e~ple, how sho~d v~ations in energy use due to fluctuations in weather or

occupancy levels be addressed?

14~e Wget should ~pec@ whether ~omm accom~g or site acco~ting is used for el~tricity sin= the choice Wn make a difference (S= ch. 2).
Chapter 7--Policy Issues and Options for Improving Federal Energy Efficiency . 111

information on the energy efficiency of products

provided. This is true even for energy-intensive

products such as light bulbs and ballasts. Federal

purchasers must obtain contractors’ catalogs and

price lists for information, but even these may

contain inadequate or incomplete information on

energy characteristics. To be effective, the information would have to be in a form useful to facility

personnel. It may include information on both

life-cycle costs and on efficiency or performance.

A second possible procurement change is to

increase the use of life-cycle costing in the

selection of goods and services. Currently, agencies are directed to consider life-cycle costs in their

purchases of certain products such as HVAC equipment, and GSA considers life-cycle costs in selecting household appliances such as refrigerators and

water heaters. This practice could be expanded to

include more energy-using goods such as lamps,

ballasts, and automobiles, and by performing more

frequent updates of analyses for household appliances. Energy-related services could be included

too. For example, the selection of contractors for

operation and maintenance of HVAC equipment at

Federal facilities could be based on life-cycle costs

including not only the direct cost of the contract, but

also the expected cost of energy used based on the

practices specified in the contract.

A third possible procurement change is to

simplify procurement of new energy efficient

products and services. Some Federal procurement

policies are complex, cumbersome, or confusing,

which can impede use of novel goods and services.

This is particularly important since many energy

efficiency measures are relatively new. One example

of a confusing situation which seems to have been

resolved is the ability of Federal facilities to accept

utility rebates. Because procurement policies had

not previously addressed that situation, there was

some question about whether and how Federal

facilities could receive rebates for performing energy management activities. To clarify the issue, the

National Defense Authorization Act for fiscal year

1991 (NDAA, 1991) and the Treasury, Postal

Service and General Appropriations Act, 1991,

explicitly allow DOD and GSA to participate in

utility programs. Similarly, the New Item Introductory Schedules seem to be a useful mechanism for

simplifying and speeding the availability of novel

products in Federal facilities. There may be other

areas where a change or clarification of acquisition

regulations could help promote energy efficiency

measures. For example, changing the regulations

governing SES contracts to simplify them and

increase agency flexibility may help promote that

novel form of private financing. Also, the ‘‘Operations and Maintenance Energy Services” contract

developed by the Navy to simplify and speed up

contracting for some high payback projects could be

analyzed for use throughout the government.15

Rewarding Agencies and Facilities for Energy

and Cost Savings

Because energy is not central to most agencies’

mission, and because energy costs are such a small

component of most agencies total spending, energy

efficiency naturally receives a relatively low priority. Creating incentives for agencies and individual facilities is one way to raise priorities for

energy efficiency efforts. There are notable exceptions, but generally Congress has neither rewarded

nor penalized agencies for energy-related performance; regional and headquarters offices neither

rewarded nor penalized facilities; and facility managers neither rewarded nor penalized their staff.

Under NDAA, 1991, military facilities are now

allowed to retain two-thirds of the energy cost

savings (see ch. 2). That type of incentive could be

expanded by offering it to all agencies, not just

Department of Defense (DOD) facilities. DOD’s

new incentive needs to be carefully monitored to

ensure that it is being properly and fully implemented, and revised as necessary.

Rewarding Individuals for Energy

and Cost Savings

At least two existing types of incentives for

individuals could be considered for greater use.16

First, FEMP’s annual Federal Efficiency Energy

Awards (see ch. 2) could be expanded by giving

award winners not just a certificate of merit, but

a cash bonus as well .17 Often, the FEMP award

Issee U.S. Dep~mentof Energy, Fede~ Energy Management Progrq ‘‘Federal Energy Management Activities, ’ DOEKE-0281-1, winter 1990,

p. 4.

16pefio rmance awards and superior accomplishment awards are explicitly allowed under 5CFR 430 and 5CFR451 (Jan. 1, 1991 edition).

ITGSA Cwenfly gives Federal Energy Efficiency Award winners a $1,000 bonus as part of an incentive program.
112 ● Energy Efficiency in the Federal Government: Government by Good Example?

winners have demonstrated not just innovation in

energy management, but also produce tangible

cost-savings which far exceed their salaries. A prize

of several hundred to a few thousand dollars for each

of the 15 award winners each year could be an

effective part of a campaign to increase awareness

and enthusiasm for FEMP’s important activities, as

well as reward excellence in public service. The cost

of the prizes should be more than compensated for

by reduced spending on energy, although the savings

accrue to the agencies, not to FEMP.

To reach out to all of the several thousand Federal

facilities (not just the handful receiving FEMP

awards) would require a more broad-based incentive. One model which could be considered is the

monetary incentive program developed by the National Capital Region of the General Services

Administration (GSA) for its facility personnel (see

ch. 6). DOE and GSA could analyze the National

Capital Region’s innovative incentive program to

determine how to best replicate it throughout

Federal facilities. Key issues include which personnel should be eligible for awards, the methods used

to demonstrate that energy and cost savings actually

occur, and the amount of the bonuses.

Following Through and Enforcing

Following through on Federal energy management programs is essential. Ongoing congressional

attention in the form of new legislation, hearings and

other contact helps raise the priority of energy

efficiency efforts within Federal agencies. The same

is true of the many General Accounting Office

reports requested by Congress on Federal energy

efficiency efforts.18 To demonstrate further interest,

Congress could consider requesting regular or occasional reports by inspectors general at the five key

energy-using agencies which together account for

over 90 percent of Federal energy use and have most

responsibility for Federal energy management.l9

Promoting Research, Development, and

Demonstration

Research, development, and demonstration are all

vital to innovation and the practical application of

new energy efficient technologies. For example,

highly efficient electronic ballasts which are now

commercially available were partly a result of

Federal R&D efforts at Lawrence Berkeley Laboratory. 20 Vacuum insulation, expected to become

commercially available in applications such as

highly efficient refrigerators later in this decade, is

another technology benefiting from Federal R&D.

R&D in physical sciences and engineering is essential for making this type of hardware available.

Commercialization and widespread application

do not necessarily result rapidly after development

of even economically attractive technologies. Again,

the long time between research, commercial production, and eventual widespread use for modern

electronic ballasts provides an example. Close

cooperation between research and development and

the manufacturers is critical to ensuring that useful

new concepts proceed toward commercialization as

rapidly as possible.

Even for economically attractive new commercial

products, gaining consumer acceptance and widespread use takes considerable time. Under what

conditions of initial cost, future savings, and risk

will consumers and institutions adopt new energy

efficient technologies? Research into these perspectives can be useful in developing programs which

best deliver energy- and cost-saving technologies

both for the Federal Government and for the private

sector. Similarly, there can be substantial benefits to

demonstrating how well and under what conditions

energy efficient measures work in the real world.

Making the most effective use of Federal funds

involves a balance between this type of R&D and the

type in physical sciences and engineering.

lgGener~ Accowting offlcereports on F~eralenerg-yefflciency efforts reach back at least to the late 1970s. See, for example, U.S. Cowess, Genera

Accounting OffIce, Evaluation of the Plan TO Conserve Energy in Federal Buildings Through Retrojit Programs, EMD-78-2 (Washington, DC: Mar.

29, 1977); and U.S. Congress, General Accounting Office, A-fore Use Shou/d Be Made of Energy-Saving Products in Federal Buildings, EMD-79-1O

(Washington, DC: Jan. 23, 1979).

lg~ong tie Pvses, Con=ess sp=ifi~ k estabfis~g me Offices of inspector general is “to provide leadership . . . and recommend Policies . . .

to promote economy, efficiency, and effectiveness“ in Federal agencies. Inspector General Act of 1978, as amended Public Law 95-452.

mM.A. Brow, L.G. Berry, and R.K. @cl, commercializing Government-Sponsored Innovations: Twelve Successful Buildings case studies,

ORNL/CON-275 (Oak Ridge, TN: Oak Ridge National Laboratories, January 1989), pp. 34-42.
Chapter 7--Policy Issues and Options for Improving Federal Energy Efficiency . 113

One aid to demonstration would be to produce and

disseminate written analyses of the major energy

efficiency measures taken at Federal facilities (for

example, those winning FEMP awards). These

reports could describe the type of measures taken,

the costs involved, staffing requirements, a comparison between estimated and actual savings of both

energy and spending, and the name of someone to

contact for further information. These reports could

be compiled and published regularly as one part of

FEMP’s interagency coordination and information

sharing activities. Eventually, there would be no

need to report on some measures as they become

widely accepted with well-understood costs and

performance.

Another valuable demonstration would be to

identify, implement and monitor all measures meeting minimum cost-effectiveness criteria at several

selected facilities of different sizes and uses. These

measures should include lighting, HVAC operations, maintenance and retrofits, and upgrades of

miscellaneous equipment (e.g., refrigerators). In

general, performing the most cost-effective measures frost appears to be a reasonable practice (as long

as that doesn’t preclude later retrofits). However,

using several facilities as showcases or models of the

entire range of measures could help demonstrate the

Federal government’s full cost-effective potential

and the feasibility of different approaches. One

example of this type of demonstration is an effort by

the Pacific Northwest Laboratory and FEMP to

develop a model for use by Federal customers of the

Niagara-Mohawk Power Corp. 2 1

Finally, basing Federal procurement of energyusing products on life-cycle costs can play a role

both in encouraging development and in demonstration without increasing spending on R&D. (See

“Supporting Markets for Suppliers of Efficient

Products and Services,” above.)

Zlpacific Northwest Laboratory, “Proposed Federal Agency Energy Efficiency Model Program with Niagara Mobawk Customers,” undated.