Last week, a high-level commission issued a report outlining how the U.S. could double energy productivity by 2030.
In last night’s State of the Union address, President Obama backed those findings and called for a partnership between federal and state governments to cut energy consumption in half in the next two decades.
“I’m also issuing a new goal for America: let’s cut in half the energy wasted by our homes and businesses over the next twenty years. The states with the best ideas to create jobs and lower energy bills by constructing more efficient buildings will receive federal support to help make it happen,” said the President.
That goal is exactly what the bi-partisan Commission on National Energy Efficiency Policy called for last Thursday. Democratic Senator Mark Warner and National Grid US President Tom King chaired the panel. Other members included NREL Director Dan Arvizu, former New York Governor George Pataki, and Retired General Wesley Clark.
Obama’s comments on energy efficiency were part of a series of pledges to tackle climate change, expand renewable electricity generation, and find new ways to fund alternative transportation technologies through oil and gas revenues. The plan closely followed a broad theme focused on investment, competitiveness, and education throughout the speech.
“The president really covered all of the areas that are part of the plan, from making new investments to education,” said Kateri Callahan, president of the Alliance to Save Energy.
Callahan said that members of the commission were in direct talks with the White House in the lead-up to tonight’s speech. And last week, when the report on how to achieve a doubling of energy productivity was released, the White House took a greater interest in putting the goal in the State of the Union address.
Alex Laskey, founder of the energy efficiency company Opower — and a member of the commission — said the initial idea for the target was inspired by the Obama administration’s aggressive fuel economy standards.
“Our commission asked the question: ‘If we can drive twice as far on a gallon of gasoline, why can’t our economy grow with half the energy?’” explained Laskey.
So how might the administration get the ball rolling? The recommendations from the Alliance Commission on National Energy Efficiency Policy are diverse. They include energy disclosure laws, tax reform, utility on-bill financing programs, and “race to the top” competitions between local governments.
The administration was the most receptive to competitive programs in which states and municipalities compete for prize money, said Anthony Eggert, executive director of the Policy Institute for Energy. That’s because the model closely resembles what the administration has tried to do in education.
“Race-to-the-top programs had the most interest. This seems like something the president is inclined to go back to,” said Eggert, who was also a member of the commission.
While the White House “embraced warmly” the recommendations on efficiency, rolling out such a broad suite of policies while politicians focus on fiscal austerity will be difficult. The entire plan would require $160 billion in yearly investments from private businesses, households, and across local, state, and federal governments. However, the plan would net more than $320 billion in yearly savings after 2030 while saving the average American household more than $1,000 in energy costs each year.
“The reality is we cannot afford not to do this” when considering America’s economic and fiscal health, said Eggert. “This is about getting more goods and services out of every unit of energy.”
Read President Obama’s full remarks on energy here.