I 
111TH CONGRESS 
1ST SESSION 
H. R. 889 
To amend title VI of the Public Utility Regulatory Policies Act of 1978 
to establish a Federal energy efficiency resource standard for retail 
electricity and natural gas distributors, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
FEBRUARY 4, 2009 
Mr. MARKEY of Massachusetts introduced the following bill; which was 
referred to the Committee on Energy and Commerce 
A BILL 
To amend title VI of the Public Utility Regulatory Policies 
Act of 1978 to establish a Federal energy efficiency 
resource standard for retail electricity and natural gas 
distributors, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Save American Energy 
Act’’. 
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SEC. 2. ENERGY EFFICIENCY RESOURCE STANDARD FOR 
RETAIL ELECTRICITY AND NATURAL GAS DIS-
TRIBUTORS. 
(a) IN GENERAL.—Title VI of the Public Utility Reg-
ulatory Policies Act of 1978 (16 U.S.C. 2601 and fol-
lowing) is amended by adding at the end the following: 
‘‘SEC. 610. FEDERAL ENERGY EFFICIENCY RESOURCE 
STANDARD FOR RETAIL ELECTRICITY AND 
NATURAL GAS DISTRIBUTORS. 
‘‘(a) STATEMENT OF FEDERAL POLICY.—The Fed-
eral energy efficiency resource standard established by this 
section sets nationwide minimum levels of electricity and 
natural gas savings to be achieved through utility effi-
ciency programs, building energy codes, appliance stand-
ards, and related efficiency measures. In light of the cost- 
effective energy efficiency opportunities that exist across 
the country in every sector of the economy, retail elec-
tricity distributors, retail natural gas distributors, and 
States should additionally consider energy efficiency as a 
resource in utility planning and procurement activities and 
should seek to achieve all energy efficiency that is avail-
able at lower cost than energy supply options. 
‘‘(b) DEFINITIONS.—In this section: 
‘‘(1) AFFILIATE.—The term ‘affiliate’ when 
used in relation to a person, means another person 
which owns or controls, is owned or controlled by, or 
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is under common ownership control with, such per-
son, as determined under regulations promulgated 
by the Secretary. 
‘‘(2) ASHRAE, ANSI, AND IESNA.—The terms 
‘ASHRAE’, ‘ANSI’, and ‘IESNA’ mean the Amer-
ican Society of Heating, Refrigerating and Air Con-
ditioning Engineers, the American National Stand-
ards Institute, and the Illuminating Engineering So-
ciety of North America, respectively. 
‘‘(3) BASE QUANTITY.—The term ‘base quan-
tity’, with respect to a retail electricity distributor or 
retail natural gas distributor, means, for each year 
for which a performance standard is established 
under subsection (d), the average annual quantity of 
electricity or natural gas delivered by the retail elec-
tricity distributor or retail natural gas distributor to 
retail customers during the 2 calendar years imme-
diately preceding such year. In determining the base 
quantity of a retail natural gas distributor, natural 
gas delivered for purposes of electricity generation 
shall be excluded. 
‘‘(4) CHP SAVINGS.—The term ‘CHP savings’ 
means— 
‘‘(A) CHP system savings from a combined 
heat and power system that commences oper-
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ation after the date of enactment of this sec-
tion; and 
‘‘(B) the increase in CHP system savings 
from upgrading or replacing, after the date of 
enactment of this section, a combined heat and 
power system that commenced operation on or 
before the date of enactment of this section. 
‘‘(5) CHP SYSTEM SAVINGS.—The term ‘CHP 
system savings’ means the electric output, and the 
electricity saved due to the mechanical output, of a 
combined heat and power system, adjusted to reflect 
any increase in fuel consumption by that system as 
compared to the fuel that would have been required 
to produce an equivalent useful thermal energy out-
put in a separate thermal-only system, as deter-
mined in accordance with regulations promulgated 
by the Secretary. 
‘‘(6) CODES AND STANDARDS SAVINGS.— 
‘‘(A) IN GENERAL.—The term ‘codes and 
standards savings’ means a reduction in end- 
use electricity or natural gas consumption in a 
retail electricity distributor or a retail natural 
gas distributor’s service territory as a result of 
the adoption and implementation, after the date 
of enactment of this section, of new or revised 
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‘‘(A) the system meets such requirements 
relating to efficiency and other operating char-
acteristics as the Secretary may promulgate by 
regulation; and 
‘‘(B) the net wholesale sales of electricity 
by the facility will not exceed 50 percent of 
total annual electric generation by the facility. 
‘‘(8) COST-EFFECTIVE.—The term ‘cost-effec-
tive’, with respect to an energy efficiency measure, 
means that the measure achieves a net present value 
of economic benefits over the life of the measure, 
both directly to the energy consumer and to the 
economy, that is greater than the net present value 
of the cost of the measure over the life of the meas-
ure, both directly to the energy consumer and to the 
economy. 
‘‘(9) CUSTOMER FACILITY SAVINGS.—The term 
‘customer facility savings’ means a reduction in end- 
use electricity or natural gas consumption (including 
recycled energy savings) at a facility of an end-use 
consumer of electricity or natural gas served by a re-
tail electricity distributor or natural gas distributor, 
as compared to— 
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‘‘(A) in the case of a new facility, con-
sumption at a reference facility of average effi-
ciency; 
‘‘(B) in the case of an existing facility, 
consumption at such facility during a base pe-
riod (which shall not be less than 1 year); or 
‘‘(C) in the case of new equipment, regard-
less of whether the new equipment replaces ex-
isting equipment at the end of the useful life of 
the existing equipment, consumption by new 
equipment of average efficiency of the same 
equipment type, provided that customer savings 
under this subparagraph shall not be counted 
towards customer savings under subparagraph 
(A) or (B). 
‘‘(10) ELECTRICITY SAVINGS.—The term ‘elec-
tricity savings’ means reductions in electricity con-
sumption achieved through measures implemented 
after the date of enactment of this section, as deter-
mined in accordance with regulations promulgated 
by the Secretary, limited to— 
‘‘(A) customer facility savings of elec-
tricity, adjusted to reflect any associated in-
crease in fuel consumption at the facility; 
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‘‘(B) reductions in distribution system 
losses of electricity achieved by a retail elec-
tricity distributor, as compared to losses attrib-
utable to new or replacement distribution sys-
tem equipment of average efficiency (as defined 
in regulations to be promulgated by the Sec-
retary); 
‘‘(C) CHP savings; and 
‘‘(D) codes and standards savings of elec-
tricity. 
‘‘(11) NATURAL GAS SAVINGS.—The term ‘nat-
ural gas savings’ means reductions in natural gas 
consumption from measures implemented after the 
date of enactment of this section, as determined in 
accordance with regulations promulgated by the Sec-
retary, limited to— 
‘‘(A) customer facility savings of natural 
gas, adjusted to reflect any associated increase 
in electricity consumption or consumption of 
other fuels at the facility; 
‘‘(B) reductions in leakage, operational 
losses, and consumption of natural gas fuel to 
operate a gas distribution system, achieved by 
a retail natural gas distributor, as compared to 
similar leakage, losses, and consumption during 
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a base period (which shall not be less than 1 
year); and 
‘‘(C) codes and standards savings of nat-
ural gas. 
‘‘(12) POWER
POOL.—The term ‘power pool’ 
means an association of 2 or more interconnected 
electric systems that is recognized by the Commis-
sion as having an agreement to coordinate oper-
ations and planning for improved reliability and effi-
ciencies, including a Regional Transmission Organi-
zation or an Independent System Operator. 
‘‘(13) RECYCLED ENERGY SAVINGS.—The term 
‘recycled energy savings’ means a reduction in elec-
tricity or natural gas consumption that results from 
a modification of an industrial or commercial system 
that commenced operation before the date of enact-
ment of this section, in order to recapture electrical, 
mechanical, or thermal energy that would otherwise 
be wasted, as determined in accordance with regula-
tions promulgated by the Secretary. 
‘‘(14) REPORTING PERIOD.—The term ‘report-
ing period’ means— 
‘‘(A) calendar year 2012; and 
‘‘(B) each successive 2-calendar-year pe-
riod thereafter. 
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‘‘(15) RETAIL ELECTRICITY DISTRIBUTOR.— 
‘‘(A) IN GENERAL.—The term ‘retail elec-
tricity distributor’ means, for any given cal-
endar year, an electric utility that owns or oper-
ates an electric distribution facility and, using 
the facility, delivered not less than 1,500,000 
megawatt-hours of electric energy to electric 
consumers for purposes other than resale dur-
ing the most recent 2-calendar-year period for 
which data are available. 
‘‘(B) INCLUSIONS AND LIMITATIONS.—For 
purposes of determining whether an electric 
utility qualifies as a retail electricity distributor 
under subparagraph (A)— 
‘‘(i) deliveries by any affiliate of an 
electric utility to electric consumers for 
purposes other than resale shall be consid-
ered to be deliveries by such electric utility; 
and 
‘‘(ii) deliveries by any electric utility 
to a lessee, tenant, or affiliate of such elec-
tric utility shall not be treated as deliveries 
to electric consumers. 
‘‘(16) RETAIL NATURAL GAS DISTRIBUTOR.— 
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‘‘(A) IN GENERAL.—The term ‘retail nat-
ural gas distributor’ means, for any given cal-
endar year, a local distribution company, as 
that term is defined in section 2(17) of the 
Natural Gas Policy Act of 1978 (15 U.S.C. 
3301(17)), that delivered to natural gas con-
sumers more than 5,000,000,000 cubic feet of 
natural gas during the most recent 2-calendar- 
year period for which data are available. 
‘‘(B) INCLUSIONS AND LIMITATIONS.—For 
purposes of determining whether a person 
qualifies as a retail natural gas distributor 
under subparagraph (A)— 
‘‘(i) deliveries of natural gas by any 
affiliate of a local distribution company to 
consumers for purposes other than resale 
shall be considered to be deliveries by such 
local distribution company; and 
‘‘(ii) deliveries of natural gas to a les-
see, tenant, or affiliate of a local distribu-
tion company shall not be treated as deliv-
eries to natural gas consumers. 
‘‘(17) THIRD-PARTY EFFICIENCY PROVIDER.— 
The term ‘third-party efficiency provider’ means any 
retailer, building owner, energy service company, fi-
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