State Efficiency Standards Are Good For Everyone

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Originally published on the NRDC Expert Blog.
By Lauren Urbanek

The federal government continues to miss legal deadlines for energy efficiency standards for appliances, equipment, and electronics with 17 standards overdue for review and more on the horizon. That’s bad news for anyone who likes saving energy, lower utility bills, and a cleaner planet.

Fortunately, more states are setting efficiency standards in the absence of federal action, which is good news for U.S. consumers and the climate.

Washington, Colorado, and Hawaii recently passed laws to set efficiency standards for a variety of products, which will generate hundreds of millions of dollars of utility bill savings for their residents while saving lots of energy and water. (Smarter energy use also avoids the need to generate as much electricity from fossil fuels, which create emissions that harm our health and the environment.) They join states like California and Vermont, which already have a robust set of state standards. In total, state standards will provide energy and water savings for nearly 55 million residents of those 5 states, with hopefully more to come.

Why State Standards?

The federal appliance standards program sets the minimum energy consumption levels for most of the appliances, equipment, and electronics we use every day. Standards on the books are already saving consumers more than $2 trillion on their energy bills.

But the federal government isn’t the only player in this space – some states have been setting their own standards since the 1970s for products sold in their states and continue to do so today.

Over the past decade or so the federal government has done most of the heavy lifting on efficiency standards, which both we and equipment manufacturers prefer. Advocates like a national standard because it guarantees savings in every state in the country, and it’s easier for manufacturers to comply with one nationwide standard than a patchwork of state regulations. The Trump administration has signaled a very different view of standards. While we’re going to keep fighting to protect and preserve national standards and the trillions of dollars in savings for consumers, states can help lead the way by pushing forward their own standards for additional products.

Under federal law, states are generally “preempted,” or prohibited, from establishing state energy-efficiency standards for products already covered by federal standards. And if the federal government establishes an efficiency standard for a product the states already are regulating, the state standard is superceded. There are exceptions to this rule, but most states instead establish energy efficiency for products that are not covered by the federal appliance standards program. States including Texas, Oregon, Arizona, and New Hampshire already have state standards on the books for a select number of products.

Significant products not covered by federal standards include computers and monitors, certain water-using products, and commercial kitchen equipment. In some cases, it is difficult to set a federal standard for these products. For example, computer and monitor technology changes very frequently, so states are better equipped to set a nimble standard that goes into effect sooner than a federal standard would.

Products not covered by federal standards have the potential to save Americans a substantial amount of energy. Water-saving products represent some of the biggest savings: if all states adopted standards for faucets, showerheads, lawn spray sprinklers, and toilets, consumers would save more than $10 billion annually on their utility bills by 2035. Saving water saves energy, too: by using less water, energy savings are achieved by not having to pump and treat the water—or heat as much hot water.

The new laws passed in Washington, Colorado, and Hawaii are based on a model bill created by the Appliance Standards Awareness Project, with input from NRDC and others. Each state customizes the bill to fit its own unique wants and needs, and the results are impressive:

Washington

The law passed in Washington expands Washington’s state standards to 19 products, including commercial kitchen equipment, computers and monitors, faucets, and showerheads. (Washington had standards already on the books since 2009 for other products like pool pumps and hot food-holding cabinets).

Furthermore, the law requires that electric water heaters be “grid-ready,” meaning they are equipped with a communications interface that makes them prepared for use in utility demand response programs, which compensate customers for altering energy use. This is a particularly innovative approach, as water heaters are essentially big batteries in the basements of our homes. Ensuring that they are grid-ready will enable utility companies to better manage the electric load on the grid, which means water can be pre-heated during times when electricity is generated by clean, inexpensive renewable power. Then, consumers can use that hot water throughout the day, avoiding the costs of electricity during the times of day when it is more expensive and being generated by dirtier power plants. Being able to use water heating to balance the grid means more reliability, lower carbon emissions, and lower costs for consumers.

Over the next 15 years, new standards will save Washingtonians more than $2 billion on their utility bills, while saving 150 billion gallons of water. They’ll also reduce carbon pollution emissions by 6 million metric tons, equivalent to a year’s emissions from 1.3 million cars.

Colorado

Colorado’s new standards law covers 16 products, including an update for faucets and commercial toilets to save more water. (Colorado has had state standards for faucets, showerheads, toilets, and urinals since 2014). Consumers and businesses in Colorado will save more than $1 billion on their utility bills over the next 15 years, including 85 billion gallons of water and avoid 3 million metric tons of carbon pollution.

Notably, both Washington and Colorado are adopting state standards for products that are “in limbo” due to DOE inaction. This includes standards for portable air conditioners, uninterruptible power supplies, and air compressors, which were due to be finalized in early 2017. DOE never published them (along with a standard for commercial boilers) in the Federal Register, and they remain unpublished as we await the final decision in a lawsuit brought by NRDC.

Both states also adopted an important backstop for general service lamps, stating that all bulbs sold in the state must meet a 45 lumen per watt efficiency on January 1, 2020. This efficiency level is already in place in California and is set to take effect nationwide in just over 7 months. Yet DOE has been messing around with the lighting standards, putting billions of dollars of savings at risk. State backstops for general service lamps will protect consumers in case the federal Department of Energy decides to roll back the 2020 standards.

Hawaii

Hawaii this year adopted its first-ever state standards, covering computers, monitors, faucets, high color rendering index linear fluorescent lights (a type of tube-shaped bulb that was not part of federal regulations), showerheads, and spray sprinkler bodies. Hawaii will align with standards already in place in California for these products, meaning the more energy efficient products are already widely available and extremely cost-effective, with benefits outweighing costs in less than a year in all cases (and often immediately). Taken together, these standards will save Hawaiian consumers and businesses $77 million on their utility bills in 2035, with most of that savings coming from water-savings products.

And Hopefully More to Come

More states than ever are still considering state standards, either for this legislative session or for action in the next year. In places like New York, Massachusetts, Minnesota, Nevada, and Washington DC, lawmakers are actively discussing state standards action. Other states like New Jersey, Maine, and Illinois have shown great interest but probably won’t move a bill until next year.

Markets for appliances and equipment tend to be regional. With great representation of state standards on the west coast, and lots of interest on the east coast, we may start to see a positive spillover effect, where markets in neighboring states benefit from more efficient equipment. It may just take a few additional states to move an entire region toward a “de-facto” standard, where manufacturers find it easier to sell the same high-efficient product everywhere rather than making less efficient products for certain states. Once that happens, it becomes even easier to set a national standard. That’s the power of state standards!