II 

111TH CONGRESS 

1ST SESSION S. 1574 

To establish a Clean Energy for Homes and Buildings Program in the 

Department of Energy to provide financial assistance to promote residential-, commercial-, and industrial-scale energy efficiency and on-site renewable technologies. 

IN THE SENATE OF THE UNITED STATES 

AUGUST 4, 2009 

Mr. MERKLEY (for himself and Mr. LUGAR) introduced the following bill; 

which was read twice and referred to the Committee on Energy and Natural Resources 

A BILL 

To establish a Clean Energy for Homes and Buildings Program in the Department of Energy to provide financial 

assistance to promote residential-, commercial-, and industrial-scale energy efficiency and on-site renewable 

technologies. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Clean Energy for 

5 Homes and Buildings Act of 2009’’. 

6 SEC. 2. FINDINGS. 

7 Congress finds that— 


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1 (1) homes and commercial or industrial build2 ings in the United States consume significant quan3 tities of energy, including energy for electricity and 

4 heating, the generation or combustion of which cre5 ates significant quantities of greenhouse gas emis6 sions; 

7 (2) in most cases, energy efficiency is the most 

8 cost-effective and rapidly deployable strategy for re9 ducing greenhouse gas emissions, energy demand, 

10 and the need for long-distance transmission of en11 ergy; 

12 (3) on-site renewable energy generation reduces 

13 greenhouse gas emissions, demand on the electricity 

14 transmission grid, and the need for long-distance 

15 transmission of energy; 

16 (4) many energy efficiency measures and on17 site renewable energy generation systems produce a 

18 net cost savings over the course of the useful life of 

19 the measures and systems, and often over a shorter 

20 time frame, but the initial expense required to pur21 chase and install the measures and systems is often 

22 a significant barrier to widespread investment in the 

23 measures and systems; 

24 (5) financial products, financing programs, and 

25 other programs that reduce or eliminate the need for 


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1 the initial expense described in paragraph (4) can 

2 permit building owners to invest in measures and 

3 systems that reduce total energy costs and realize 

4 net cost savings at the time of the installation of the 

5 measures and systems, defer capital expenditure, 

6 and enhance the value, comfort, and sustainability of 

7 the property of the owners; and 

8 (6) State and local governments, utilities, en9 ergy efficiency and renewable energy service pro10 viders, banks, finance companies, community devel11 opment organizations, and other entities are devel12 oping financial products and programs to provide fi13 nancing assistance for building owners to encourage 

14 the use of the measures and systems described in 

15 paragraph (4), including programs that allow repay16 ment of loans under programs described in para17 graph (5) through utility bills, or through property18 based assessments, taxes, or charges, to facilitate 

19 loan repayment for the benefit of building owners 

20 and lenders or program sponsors. 

21 SEC. 3. PURPOSE. 

22 The purpose of this Act is to encourage widespread 

23 deployment of energy efficiency and on-site renewable en24 ergy technologies in homes and other buildings throughout 

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1 taining Clean Energy for Homes and Buildings Program 

2 that can— 

3 (1) encourage the widespread availability of fi4 nancial products and programs with attractive rates 

5 and terms that significantly reduce or eliminate up6 front expenses to allow building owners (including 

7 homeowners, business owners, owners of multifamily 

8 housing, owners of multi-tenant commercial prop9 erties, and owners of other residential, commercial, 

10 or industrial properties) to invest in energy effi11 ciency measures and on-site renewable energy sys12 tems with payback periods of up to 25 years or the 

13 useful life of such a measure or system by providing 

14 credit support, credit enhancement, secondary mar15 kets, and other support to originators of the finan16 cial products and sponsors of the financing pro17 grams; and 

18 (2) help building owners invest in measures and 

19 systems that reduce energy costs, in many cases cre20 ating a net cost savings that can be realized in the 

21 short-term, and may also allow building owners to 

22 defer capital expenditures and increase the value, 

23 comfort, and sustainability of the property of the 

24 owners. 


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1 SEC. 4. DEFINITIONS. 

2 In this Act: 

3 (1) COST.—The term ‘‘cost’’ has the meaning 

4 given the term in section 502 of the Federal Credit 

5 Reform Act of 1990 (2 U.S.C. 661a). 

6 (2) DIRECT LOAN.—The term ‘‘direct loan’’ has 

7 the meaning given the term in section 502 of the 

8 Federal Credit Reform Act of 1990 (2 U.S.C. 661a). 

9 (3) LOAN GUARANTEE.—The term ‘‘loan guar10 antee’’ has the meaning given the term in section 

11 502 of the Federal Credit Reform Act of 1990 (2 

12 U.S.C. 661a). 

13 (4) PROGRAM.—The term ‘‘Program’’ means 

14 the Clean Energy for Homes and Buildings Program 

15 established by section 6. 

16 (5) SECRETARY.—The term ‘‘Secretary’’ means 

17 the Secretary of Energy. 

18 (6) SECURITY.—The term ‘‘security’’ has the 

19 meaning given the term in section 2 of the Securities 

20 Act of 1933 (15 U.S.C. 77b). 

21 (7) STATE.—The term ‘‘State’’ means— 

22 (A) a State; 

23 (B) the District of Columbia; 

24 (C) the Commonwealth of Puerto Rico; 

25 and 


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1 (D) any other territory or possession of the 

2 United States. 

3 SEC. 5. CLEAN ENERGY FOR HOMES AND BUILDINGS 

4 GOALS. 

5 (a) IN GENERAL.—Not later than 180 days after the 

6 date of enactment of this Act, the Secretary shall develop 

7 and publish for review and comment in the Federal Reg8 ister near-, medium-, and long-term goals (including nu9 merical performance targets at appropriate intervals to 

10 measure progress toward those goals) for— 

11 (1)(A) a minimum number of homes to be ret12 rofitted through energy efficiency measures or to 

13 have on-site renewable energy systems added; 

14 (B) a minimum number of other buildings, by 

15 type, to be retrofitted through energy efficiency 

16 measures or to have on-site renewable energy sys17 tems added; and 

18 (C) the number of on-site solar energy, wind 

19 energy, and geothermal heat pump systems to be in20 stalled; and 

21 (2) as a result of those retrofits, additions, and 

22 installations— 

23 (A) the quantity by which use of grid-sup24 plied electricity, natural gas, home heating oil, 

25 and other fuels will be reduced; 


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1 (B) the quantity by which total fossil fuel 

2 dependence in the buildings sector will be re3 duced; 

4 (C) the quantity by which greenhouse gas 

5 emissions will be reduced; 

6 (D) the number of jobs that will be cre7 ated; and 

8 (E) the estimated total energy cost savings 

9 for building owners. 

10 (b) ESTIMATES BY ORIGINATORS OR SPONSORS.— 

11 The Secretary may rely on reasonable estimates made by 

12 originators of financial products or sponsors of financing 

13 programs for tracking progress toward meeting the goals 

14 established under this section instead of requiring building 

15 owners to monitor and report on the progress. 

16 SEC. 6. CLEAN ENERGY FOR HOMES AND BUILDINGS PRO17 GRAM. 

18 (a) ESTABLISHMENT.—There is established in the 

19 Department of Energy a program to be known as the 

20 Clean Energy for Homes and Buildings Program. 

21 (b) ELIGIBILITY CRITERIA.— 

22 (1) IN GENERAL.—In administering the Pro23 gram, the Secretary shall establish eligibility criteria 

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1 section (c) who can offer financial products and pro2 grams consistent with the purposes of this Act. 

3 (2) CRITERIA.—Criteria for applicants shall— 

4 (A) take into account— 

5 (i) the number and type of buildings 

6 that can be served by the applicant, the 

7 size of the potential market, and the scope 

8 of the program (in terms of measures or 

9 technologies to be used); 

10 (ii) the ability of the applicant to suc11 cessfully execute the proposed program 

12 and maintain the performance of the pro13 posed projects and investments; 

14 (iii) financial criteria, as applicable, 

15 including the ability of the applicant to 

16 raise private capital or other sources of 

17 funds for the proposed program; 

18 (iv) criteria that enable the Secretary 

19 to determine sound program design, in20 cluding— 

21 (I) an assurance of credible en22 ergy efficiency or renewable energy 

23 generation performance; and 

24 (II) financial product or program 

25 design that effectively reduces barriers 


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1 posed by traditional financing pro2 grams; 

3 (v) such criteria, standards, guide4 lines, and mechanisms as will enable the 

5 Secretary, to the maximum extent prac6 ticable, to communicate to program spon7 sors and originators, servicers, and sellers 

8 of financial obligations the eligibility of 

9 loans for resale; 

10 (vi) the ability of the applicant to re11 port relevant data on program perform12 ance; and 

13 (vii) the ability of the applicant to use 

14 incentives or marketing techniques that are 

15 likely to result in successful market pene16 tration; and 

17 (B) encourage— 

18 (i) use of technologies that are either 

19 well-established or new, but demonstrated 

20 to be reliable; 

21 (ii) applicants that can offer building 

22 owners payment plans generally designed 

23 to permit the combination of energy pay24 ments and assessments or charges from 

25 the installation or payments associated 


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1 with financing to be lower than the energy 

2 payments prior to installing energy effi3 ciency measures or on-site renewable en4 ergy technologies; 

5 (iii) applicants that will use repay6 ment mechanisms convenient for building 

7 owners, such as tax-increment financing, 

8 special tax districts, on-utility-bill repay9 ment, or other mechanisms; 

10 (iv) applicants that can provide con11 venience for building owners by combining 

12 participation in the lending program 

13 with— 

14 (I) processing for tax credits and 

15 other incentives; and 

16 (II) technical assistance in select17 ing and working with vendors to pro18 vide energy efficiency measures or on19 site renewable energy generation sys20 tems; 

21 (v) applicants the projects of which 

22 will use contractors that hire within a 50- 

23 mile radius of the project, or as close as is 

24 practicable; 


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1 (vi) applicants that will use materials 

2 and technologies manufactured in the 

3 United States; 

4 (vii) partnerships with or other in5 volvement of State workforce investment 

6 boards, labor organizations, community7 based organizations, State-approved ap8 prenticeship programs, and other job train9 ing entities; and 

10 (viii) applicants that can provide fi11 nancing programs or financial products 

12 that mitigate barriers other than the initial 

13 expense of installing measures or tech14 nologies, such as unfavorable lease terms. 

15 (3) DIVERSE PORTFOLIO.—In establishing cri16 teria and selecting applicants to receive financial as17 sistance under subsection (c), to the maximum ex18 tent practicable, the Secretary shall select a portfolio 

19 of investments that reaches a diversity of building 

20 owners, including— 

21 (A) individual homeowners; 

22 (B) multifamily apartment building own23 ers; 

24 (C) condominium owners associations; 


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1 (D) commercial building owners, including 

2 multi-tenant commercial properties; and 

3 (E) industrial building owners. 

4 (c) FINANCIAL ASSISTANCE.— 

5 (1) IN GENERAL.—For applicants determined 

6 to be eligible under criteria established under sub7 section (b), the Secretary may provide financial as8 sistance in the form of direct loans, letters of credit, 

9 loan guarantees, insurance products, other credit en10 hancements or debt instruments (including 

11 securitization or indirect credit support), or other fi12 nancial products to promote the widespread deploy13 ment of, and mobilize private sector support of cred14 it and investment institutions for, energy efficiency 

15 measures and on-site renewable energy generation 

16 systems in buildings. 

17 (2) FINANCIAL PRODUCTS.—The Secretary— 

18 (A) in cooperation with Federal, State, 

19 local, and private sector entities, shall develop 

20 debt instruments that provide for the aggrega21 tion of, or directly aggregate, programs for the 

22 deployment of energy efficiency measures and 

23 on-site renewable energy generation systems on 

24 a scale appropriate for residential, commercial, 

25 or industrial applications; and 


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1 (B) may insure, guarantee, purchase, and 

2 make commitments to purchase any debt in3 strument associated with the deployment of 

4 clean energy technologies (including subordi5 nated securities) for the purpose of enhancing 

6 the availability of private financing for the de7 ployment of energy efficiency measures and on8 site renewable energy generation systems. 

9 (3) APPLICATION REVIEW.— 

10 (A) IN GENERAL.—To the maximum ex11 tent practicable and consistent with sound busi12 ness practices, the Secretary shall seek to expe13 dite reviews of applications for credit support 

14 under this Act in order to communicate to ap15 plicants in a timely manner the likelihood of 

16 support so that the applicants can seek private 

17 capital in order to receive final approval. 

18 (B) MECHANISMS.—In carrying out this 

19 paragraph, the Secretary shall consider using 

20 mechanisms such as— 

21 (i) a system for conditional pre-ap22 proval that informs applicants that final 

23 applicants will be approved, if established 

24 conditions are met; 


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1 (ii) clear guidelines that communicate 

2 to applicants what level of performance on 

3 eligibility criteria will ensure approval for 

4 credit support or resale; 

5 (iii) in the case of an applicant port6 folio of more than 300 loans or other fi7 nancial arrangement, an expedited review 

8 based on statistical sampling to ensure 

9 that the loan or other financial arrange10 ment meets the eligibility criteria; and 

11 (iv) in the case of an applicant with a 

12 demonstrated track record with respect to 

13 successfully originating eligible loans or 

14 other financial arrangements and who 

15 meets appropriate other criteria deter16 mined by the Secretary, a system for dele17 gating responsibility for meeting eligibility 

18 criteria that includes appropriate protec19 tions such as buy-back mechanisms in the 

20 event criteria are determined not to have 

21 been met. 

22 (C) DISPOSITION OF DEBT OR INTER23 EST.—The Secretary may acquire, hold, and 

24 sell or otherwise dispose of, pursuant to com25 mitments or otherwise, any debt associated with 


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1 the deployment of clean energy technologies or 

2 interest in the debt. 

3 (D) PRICING.— 

4 (i) IN GENERAL.—The Secretary may 

5 establish requirements, and impose charges 

6 or fees, which may be regarded as elements 

7 of pricing, for different classes of appli8 cants, originators, sellers, servicers, or 

9 services. 

10 (ii) CLASSIFICATION OF APPLICANTS, 

11 ORIGINATORS, SELLERS AND SERVICERS.— 

12 For the purpose of clause (i), the Secretary 

13 may classify applicants, originators, sellers 

14 and servicers as necessary to promote 

15 transparency and liquidity and properly 

16 characterize the risk of default. 

17 (E) SECONDARY MARKET SUPPORT.— 

18 (i) IN GENERAL.—The Secretary may 

19 lend on the security of, and make commit20 ments to lend on the security of, any debt 

21 that the Secretary has insured, guaran22 teed, issued or is authorized to purchase 

23 under this section. 


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1 (ii) AUTHORIZED ACTIONS.—On such 

2 terms and conditions as the Secretary may 

3 prescribe, the Secretary may— 

4 (I) give security; 

5 (II) insure; 

6 (III) guarantee; 

7 (IV) purchase; 

8 (V) sell; 

9 (VI) pay interest or other return; 

10 and 

11 (VII) issue notes, debentures, 

12 bonds, or other obligations or securi13 ties. 

14 (F) LENDING ACTIVITIES.— 

15 (i) IN GENERAL.—The Secretary shall 

16 determine— 

17 (I) the volume of the lending ac18 tivities of the Program; and 

19 (II) the types of loan ratios, risk 

20 profiles, interest rates, maturities, and 

21 charges or fees in the secondary mar22 ket operations of the Program. 

23 (ii) OBJECTIVES.—Determinations 

24 under clause (i) shall be consistent with 

25 the objectives of— 


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1 (I) providing an attractive invest2 ment environment for programs that 

3 install energy efficiency measures or 

4 on-site renewable energy generation 

5 technologies; 

6 (II) making the operations of the 

7 Program self-supporting over the long 

8 term; and 

9 (III) advancing the goals estab10 lished under this Act. 

11 (G) EXEMPT SECURITIES.—All securities 

12 issued, insured, or guaranteed by the Secretary 

13 shall, to the same extent as securities that are 

14 direct obligations of or obligations guaranteed 

15 as to principal or interest by the United States, 

16 be considered to be exempt securities within the 

17 meaning of the laws administered by the Secu18 rities and Exchange Commission. 

19 SEC. 7. GENERAL PROVISIONS. 

20 (a) PERIODIC REPORTS.—Not later than 1 year after 

21 commencement of operation of the Program and at least 

22 biannually thereafter, the Secretary shall submit to the 

23 Committee on Energy and Natural Resources of the Sen24 ate and the Committee on Energy and Commerce of the 

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1 tion of the Program in meeting the purpose and goals es2 tablished by or pursuant to this Act. 

3 (b) AUDITS BY THE COMPTROLLER GENERAL.— 

4 (1) IN GENERAL.—The programs, activities, re5 ceipts, expenditures, and financial transactions of 

6 the Program shall be subject to audit by the Comp7 troller General of the United States under such rules 

8 and regulations as may be prescribed by the Comp9 troller General. 

10 (2) ACCESS.—The representatives of the Gov11 ernment Accountability Office shall— 

12 (A) have access to the personnel and to all 

13 books, accounts, documents, records (including 

14 electronic records), reports, files, and all other 

15 papers, automated data, things, or property be16 longing to, under the control of, or in use by 

17 the Program, or any agent, representative, at18 torney, advisor, or consultant retained by the 

19 Program, and necessary to facilitate the audit; 

20 (B) be afforded full facilities for verifying 

21 transactions with the balances or securities held 

22 by depositories, fiscal agents, and custodians; 

23 (C) be authorized to obtain and duplicate 

24 any such books, accounts, documents, records, 

25 working papers, automated data and files, or 


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1 other information relevant to the audit without 

2 cost to the Comptroller General; and 

3 (D) have the right of access of the Comp4 troller General to such information pursuant to 

5 section 716(c) of title 31, United States Code. 

6 (3) ASSISTANCE AND COST.— 

7 (A) IN GENERAL.—For the purpose of con8 ducting an audit under this subsection, the 

9 Comptroller General may, in the discretion of 

10 the Comptroller General, employ by contract, 

11 without regard to section 3709 of the Revised 

12 Statutes (41 U.S.C. 5), professional services of 

13 firms and organizations of certified public ac14 countants for temporary periods or for special 

15 purposes. 

16 (B) REIMBURSEMENT.— 

17 (i) IN GENERAL.—On the request of 

18 the Comptroller General, the Secretary 

19 shall reimburse the General Accountability 

20 Office for the full cost of any audit con21 ducted by the Comptroller General under 

22 this subsection. 

23 (ii) CREDITING.—Such reimburse24 ments shall— 


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1 (I) be credited to the appropria2 tion account entitled ‘‘Salaries and 

3 Expenses, Government Accountability 

4 Office’’ at the time at which the pay5 ment is received; and 

6 (II) remain available until ex7 pended. 

8 SEC. 8. AUTHORIZATION OF APPROPRIATIONS. 

9 There is authorized to be appropriated to carry out 

10 this Act $2,000,000,000. 

Æ 


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