N ATURAL R ESOURCES D EFENSE C OUNCI L

Comments of NRDC o n Department of Energy Interim Final Rule: Energy Conservation for New Federal Commercia l and Multi-Family High-R i s e Residential Buildings and New Federal Low

- Rise Residential Buildings

Docket No. EE-RM/STD-02-112

David B. Goldstein, Ph.D. Natural Resources Defense Council

30 January 2007

I. Introductio n
DOE’s proposed rules represent an outr ageous m i sinterpretation of the Energy Policy Act of 2005, taking a legislative requirem e nt to es tablish standards that save at leas t 30% an d turning it into a do-it-y ourself exercise for arch itects, an ex ercis e structured to guarantee that sav i ngs will be no m o re than 30 %. DOE should rev i se this rule as soon as possible to establish explic it standards that comply with the clear and evident requirem ents of EPAct 2005, Section 109.

II. The Requirements o f EPAct

Section 109 of the Energy Policy Act of 2005 wa s intended to assure that f e deral buildings m eet substantially higher standard s for energy efficiency than ty pical n e w buildings. Subsection (1) of Section 109 imm e di ately replaced the obsolete energy code referen ces with references to curren t m odel energy codes. But it goes on directly in subsec tio n (2) to requ ire that:

“the Secretary shall establish, by rule, revised building federal energy efficiency perform a nce standards th at require that –

(i) if lifecycle cost effective for new federal buildings –

(I) the buildings be desig n ed to ach ie ve energy co nsumption levels tha t ar e at least 30% below the levels established in the version of the ASHRAE standard or Interna tional Energy C onservation Code as appropriate, that is in effect as of the date of the enactm e nt of this paragraph;...”(emphasis added)

111 Sutter St reet , 20 th Fl oo r N EW Y OR K

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⋅ L OS A NGE L ES San Francisco, C A 94104 TEL 415 87 5-61 00 FAX 415 8 7 5 -6161 www.nr dc.orgThe plain reading of this Section, which is so obvious that it is alm o st an absurdity to try to paraphrase it here, is th at the S ecretary is re quired to establish new federal building energy perform a nce standards th at save at least 30% co mpared to th e reference national codes. An exception is provided in the case that DOE determ ines that the 30% m i nim u m for the en erg y goal is no t cost effective.

In other words, DOE has an affirm ative responsibility to write a standard – or adopt one by reference – that achieves the required savings (assum i ng it is costeffective, which ample evidence dem ons tra t es tha t it is) of at least 30%.

The Published Rule does not do this. Instead, it estab lis hes the standard at the same levelas the m odel energy codes, which is what Subsection I has already done legislatively.

DOE then tries to pawn off its responsibility on to the building designer by asking the designer to not only determ ine whet her they can build a bu ild ing tha t save s 30%, but to have the flexibility to go to a lower level of sav i ngs if the ar chite ct determ ines that the stand a rd is no t co st effective.

This procedure is in blunt and obvious c ontradiction to the requirem e nts of the law. Congress did not ask DOE to set a standard ba sed on individual, building-bybuilding calculations of co st-effectiv eness. It did require DOE to establish “revised building energy efficiency perf orm a nce stand a rds that requi re that... the b u ildings b e designed to achieve energy consum ption levels that are at le a s t 30% be lo w the leve ls [ i n the m odel codes].”

DOE’s Interim Rule is also in error b ecause it attemp ts to read the words “at least” out of the legislation. There is nothi ng in DOE’s Interim Rule that attemp ts to find standards for federal buildings that save even 30.1%. This is in plain violation of the intent of Congress.

DOE’s Interim Rule is all the m o re surp rising because the amount of work that would be needed to establish cost-effective standards that m e et the explicit language as well as the intent of the law is m i nimal. Most of the effort has been m a de in docum ents that are already available, and indeed, are c ited in the In ter im Rule. The New Buildings Institute’s A dvanced BuildingsTM Benchm ar k, as noted in the Interim Rule, was intended to achieve a 30% reduction comp ared to the previous version of ASHRAE 90.1, and with m i nor technical adjustm e nts coul d easily be amended to m e et the goal of at least 30% savings. The Benchm ar k its elf points out dem o nstrations of costeffectiveness in which the provisions for m o st buildings have a payback period of 3 years or less, which is outstandingly cost-effective using the m e thodologies DOE

recomm ends in the Interim Rule. So it is evident that m i nor improvem e nt s beyond this could ach iev e cost effectiveness. Si milarly, ASHRAE’s “Advanced Energy Design Guide,” applicable for s m all office buildi ngs and retail stores, also approaches achievem e nt of the 30% savings goa l, and could have been u s ed as an ad dition a l resource by DOE staff or contractors attemp ting to develop a standard.

2Section 1331 of EPACt esta blishes a tax deduction for buildings that m eet a target of 50% savings. Federal buildings can m a ke use of this deduction to cut
governm e nt costs by assigning it to the archite ct in charge of the design. Why did DOE not require all federal buildings to m eet th is ta rget? Or if 50% is seen a s to o dif f i cult, why not set a m i ni m u m of 45% or 40%?

For residential buildings, one approach th at would have been comp liant with the law would have been even easier for DOE . The Departm e nt already provides a

m e thodology for calculating comp liance with the new hom e s tax credits, also enacted in EPAct. This m e thod requires 50% savings in heating and cooling energy comp ared to the m odel code referenced. It provides no prescriptive options for doing so. It would have been easy for DOE to require that fede ral buildings m eet this 50% target using the

m e thodology it has approved for tax credit com p lia nce. If DOE suspected that this 50% level m i ght fail the cost-effectiveness te st, which NRDC finds dubious, since m a ny builders are already taking adva ntage of the tax credit a nd w ould be profoundly unlikely to do so if it were not cos t -ef f

ective f o r th eir cus t om ers, it co uld analy ze whether th e appropriate target would be 5% or 40% or 35% ...

What is so distressing about DOE’s In terim Rule is that if Congress had intended each individu al architect to check whether 30% savings were cost effective and if not, drop back to 25%, etc., as DOE has proposed, it could have written that itself. Evidently, the fact that Congress delegated the authority and responsibility to DOE to “establish, by R u le, revised building energy efficiency standard s, ” m e ant that they intended som e thing m o re sophisticat ed than what they could have done them selves.

Ironically, DOE’s Interim rule validates Congress’ decision in Subsection I to write the initial standards legi slatively rather than through re gulation; at least the result was what the legislation intended.

III. Conclusions

EPAct Section 109 requires DOE to prom ul gate new energy efficiency standards for federal buildings that save at least 30%. The Departm e nt has failed to do so. Instead, it h a s prom ulgated a pro ced ure fo r each individu al architect or bu ilding designer to follow in seeking energy savings that m a y be as large as 30%.

DOE has the affir m ative obligation under Section 109 to do the serious analytical work that would establish actual federal building energy perform a nce standards and to do so at a leve l tha t saves m o re than 30%. Given DOE’s statutory requirem e nt to “m axi m ize energy con s ervation measures, ” DOE is obliga t ed to s e t th e percentage savings at the very highest level th at is econom ically justifiable. This m eans that DOE must sta r t its a n alysis at th e 50% savings levels established for the tax incentives, b o th for comm ercial buildings and for residential buildings, and reduce stringency from this 50% savings only if 50% fails to be cost effective.

3NRDC notes in conclusion the increasing tendency for Congress to adopt specifications that ought to be establishe d through the regulatory system by DOE explicitly as part of legislation. This di splays a profound distrust by Congress of DOE’s

comp etence at following the usual sort of le gislative direction and relying on agency discretion and expertise to ge t it r i gh t. Unf o rtunately, this ru le re inf o rces this skepticism . Regulating through legislation is not an example of good governm ent. DOE should work, in this rule and others , to produce regulatory products that

accomp lish the inten tof legislation an d are comp liant with the explicit requ irem ents, inste a d of tr ying to r e write the law.

Thank you for the opportunity to comment.

Respectf u lly Subm itted,

David B. Goldstein, Ph.D. Energy Program Director dgoldstein@ n rdc.org

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