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Industry Insights

Congress shouldn't take an ax to energy efficiency investments

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Jeffrey Barat is partner at D&B Engineering in Bloomfield.
Jeffrey Barat is partner at D&B Engineering in Bloomfield.

Coming to New Jersey in 2018: wasted electricity, higher energy bills and more pollution? Let's hope not. Yet a plan pending in Congress might bring just that, by cutting investments in energy efficiency.

As a nation, we have made tremendous progress over the past decades figuring out how to use energy more productively. Manufacturers of home appliances, from dishwashers to television sets, have developed products that use less and less electricity while delivering the same or improved performance. Homes and offices are better insulated and are built with lighting and high efficiency air conditioning systems that substantially cut energy use. 

This progress saves consumers, businesses and the government money on energy bills. It reduces pollution, because we don’t need to produce as much electricity as we would if we hadn’t innovated with efficiency.

Energy efficiency also creates jobs. Nearly 40,000 New Jersey residents work in positions related to energy efficiency, from HVAC to lighting to insulation. My company is a proud example of that economy: we are the distributor for energy-efficient air conditioning and heating equipment that is being installed in office buildings, schools, high-rise residential and government projects throughout the region.

But we’re concerned. Today, energy efficiency progress in New Jersey and across the nation is under threat.

To see why, consider how our nation improved energy efficiency in the first place. Competition between innovative companies helped, for sure. But federal investments in efficiency have been key.

The Department of Energy is the behind-the-scenes helper — running programs that stimulate efficiency gains and raise public awareness of energy efficiency benefits. The agency provides technical assistance to many small and medium-sized manufacturers, consulting on how to reduce their energy use. The department’s national labs help develop cutting-edge technologies used in the private sector, a win for U.S. firms.

The Energy Department also sets efficiency standards for products, from home appliances to industrial equipment. These standards save American households an average of nearly $500 each year on utility bills. 

At the Environmental Protection Agency, the Energy Star program certifies products that are the most energy efficient, helping consumers save more money in the long term. More than 16,000 companies and organizations participate. Energy Star costs roughly $50 million each year to administer — but delivers $34 billion in savings to American households.

It’s a good deal, and that’s why it hasn’t been very controversial. Small federal investments have helped drive energy efficiency savings for decades, with bipartisan support. Federal facilities that have incorporated strategies to reduce energy consumption save the government billions of dollars each year in energy costs.

That could all change. In July, the U.S. House of Representatives passed a spending package that would take the ax to efficiency. It would cut most of the Department of Energy’s efficiency programs by roughly half. In a separate bill, House members proposed to cut the Energy Star budget by roughly 40 percent.

Lawmakers are right to look for ways to trim the budget where they can, but these cuts would be a mistake. While saving a small amount, it would leave consumers, businesses and even the government ultimately paying far more in our energy bills. It could curtail jobs in New Jersey’s energy efficiency economy, from construction to HVAC, and lead to more pollution from increased energy production.

There’s a better path forward. In the U.S. Senate, lawmakers have advanced a spending measure that would keep the federal investments in most of the Department of Energy’s programs. Now, both chambers of Congress have to work together to reach a final deal. They should go with the Senate’s plan.

When decision time comes, our elected officials should step up to the plate and keep these investments funded. Cutting the programs would cost us all too much in the long run.

Jeffrey Barat is partner at D&B Engineering in Bloomfield.

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Mitch Vogel August 14, 2017 1:32 pm

Couldn't agree more, Jeffery. Energy efficiency is an important driver of growth, saving businesses money and paying long-term dividends comparable to power generation infrastructure or transmission lines. DOE and EPA helping to standardize things and promote market transparency is a small price to pay for these benefits.

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