Energy Efficiency Legislative Update | 2019

3/9/2020

Energy efficient building in Chicago.

In 2019, 42 states, Washington, D.C., and Puerto Rico considered over 500 bills related to energy efficiency, with over 80 measures enacted or adopted. States continued their interest in updating or expanding their Energy Efficiency Resource Standards (EERS) policies and focused on improving energy efficiency in buildings and appliances. States also considered new policies for incentivizing or financing efficient technologies. 

State Spotlight

Several states took action on a variety of energy efficiency measures, but Washington’s comprehensive energy efficiency legislation, HB 1257, stands out for enacting a number of new and aggressive efficiency requirements in a single bill, including the following:

  • Requires all new buildings with on-site parking to be electric vehicle charging-capable.
  • Directs the state Department of Commerce to establish an energy performance standard for commercial buildings that includes energy intensity targets to be updated in 2029 and every five years thereafter.
  • Establishes an early building performance compliance incentive payment program administered by qualifying utilities.
  • Provides for building energy benchmarking.
  • Directs natural gas utilities to establish an EERS for conserving gas.
  • Requires natural gas companies to offer a voluntary renewable natural gas service to replace any portion of a customer’s traditional natural gas service. 

While Washington’s HB 1257 covers a lot of ground, states across the U.S. enacted legislation that similarly focuses on improving building efficiency and conserving energy.

Energy Efficiency Resource Standards 

In addition to Washington’s new conservation targets for gas, a handful of other states enacted laws expanding on their existing EERS programs.

  • New Mexico’s HB 291 directs the Public Regulation Commission to consider utility acquisition of cost-effective energy efficiency resources to be “in the public interest,” support incentives for and remove barriers to energy efficiency programs, “act expeditiously” on public utility requests for approval of energy efficiency programs, and set energy savings targets for utilities for years 2026 through 2030.
  • In New York, SB 6599 requires the state’s new climate scoping plan to include measures that achieve, at a minimum, an energy efficiency goal of 185 trillion British Thermal Units (BTUs).
  • Vermont’s HB 63 directs the Public Utility Commission to open a proceeding to consider whether energy efficiency programs should be expanded to include all fuels, including fossil fuels. 
  • Ohio was the only state to enact legislation weakening its existing EERS program. HB 6 eliminates the state’s EERS after 2020 provided the state’s utilities have already achieved a certain amount of energy savings.

Efficiency in Utility Planning

Similarly, a number of states also established new laws requiring utilities to include energy efficiency in programs and resource planning.  

  • Washington passed SB 5116, requiring utilities to “pursue all cost-effective, reliable, and feasible conservation and efficiency resources to reduce or manage retail electric load” in achieving the state's newly enacted greenhouse gas-neutral standard during 2030 through 2044. The bill also requires utilities to submit to the utility commission a clean energy plan that includes targets for energy efficiency and demand response.
  • In Montana, HB 597 requires electric utilities to submit to the state Public Utilities Commission an integrated least-cost plan that contains conservation or efficiency programs, including demand-side management.
  • South Carolina’s HB 3659 requires utilities to submit an integrated resource plan that includes a number of resource portfolios including an evaluation of energy efficiency and demand-response. 
  • Virginia’s SB 1605 requires regulators to convene a stakeholder group between 2019 and 2028 to aid in developing energy efficiency programs.

Building Efficiency

In addition to imposing new energy savings requirements on utilities, several states established new mandates related to building efficiency. In particular, a number of states enacted laws amending their state building code requirements to reflect more recent standards for energy efficiency, also known as building energy codes

  • Maine’s legislature stood out as being particularly active in this area, enacting a number of new laws that touched on building efficiency during this past legislative session. Senate Paper 480 directs the state Technical Building Codes and Standards Board (Board) to establish an optional stretch efficiency code for local government adoption that incorporates standards exceeding the energy requirements in the state’s Uniform Building and Energy Code. HB 1101 directs the board to amend its energy code to reflect the most recent version of the International Energy Conservation Code and requires that all localities enforcing a separate building code adopt the state’s Uniform Building and Energy Code by mid-2020. Maine’s Senate Paper 550, which sets new statewide greenhouse gas reduction targets, also establishes a Climate Council and requires it to prioritize certain policies, including programs and codes that increase energy efficiency and decrease carbon emissions associated with public and private buildings. 
  • Colorado’s HB 1260 requires local governments to, at a minimum, adopt one of the three most up-to-date versions of the International Energy Conservation Code (IECC). The bill also directs local governments to report the current version of their code to the Colorado Energy Office and encourages future reporting to the office reflecting any code changes or updates.
  • IllinoisHB 2652 empowers the Capital Development Board to adopt published supplements for inclusion in the state building energy code.
  • Nebraska’s Legislative Bill 405, New Hampshire’s HB 562 and Utah’s HB 218 update their respective energy codes to require compliance with more recent versions of the International Building Code.
  • Texas enacted HB 2456, creating an optional energy efficiency code for industrialized housing.
  • North Carolina enacted HB 675, directing the state Building Code Council to conduct a cost-benefit analysis of all changes made to the North Carolina Energy Conservation Code after a certain date.
  • New York’s comprehensive Climate Leadership and Community Protection Act (SB 6599) also addressed building efficiency by requiring that the state scoping plan for achieving the state’s recently enacted greenhouse gas reduction targets include specific building efficiency programs. The state’s scoping plan must include energy efficiency measures for residential or commercial buildings, including electrification of water and space heating, appliance standards, strengthening energy efficiency codes, annual building energy benchmarking, and disclosure of energy efficiency in home sales.

Lead by Example

While some states updated their building energy codes broadly, others focused on establishing specific requirements for efficiency in public buildings, including schools. These policies are often referred to as “lead by example” and establish requirements for state-maintained buildings that are more aggressive than the state’s energy efficiency standards for commercial buildings.

  • Arkansas enacted HB 1636, amending certain contract requirements under the state’s Guaranteed Energy Cost Savings Act related to installing energy savings measures in public buildings and empowering school boards to approve compliance with rules and regulations promulgated under the act.  
  • In Connecticut, HB 5002 directs the commissioner of Energy and Environmental Protection to consult with the commissioner of Administrative Services to adopt state building construction requirements that are based on national standards promoting green, sustainable and resilient building principles and provide a standard for including electric vehicle charging stations.
  • Maine enacted HB 1152, amending its requirements for school energy conservation improvements by increasing the contract cost cap and expanding the definition of “energy service company” that designs, maintains and operates energy conservation projects on school property.
  • In New Hampshire, HB 175 amends the statutory requirements related to the state’s school building aid grant program to include energy-efficient building design among the criteria considered by the department of education in ranking proposals.
  • Oregon’s HB 2496 amends the green building requirements for state facilities to provide for the use of energy efficiency measures in lieu of green technologies in constructing new public buildings where incorporating green technologies is not feasible.
  • Tennessee’s SB 144 extends the energy-efficient schools council to 2023. 
  • Virginia’s SB 1331/HB 2192 empowers school boards to enter into agreements with private entities to design new and renovate existing buildings in accordance with “energy-positive building standards,” including specific design standards for K-12 school buildings. 

Appliance Standards 

Smart home concept image.States were also active in considering new efficiency requirements for appliances in 2019, with at least seven states enacting new laws on the topic. 

  • California’s SB 49 directs the state Energy Commission to adopt “flexible demand appliance standards” designed to increase deployment of flexible demand technologies capable of shifting demand that is based on national standards for reliability and cybersecurity. The bill further directs the commission to prioritize certain types of appliances, including those with user or third-party load-management technology options, and those are user-friendly and are open source or interoperable.
  • In Colorado, HB 1231 updates water and energy efficiency standards for specific products sold new in the state, including computers and computer monitors, uninterruptible power supplies as well as certain types of lamps and ventilating fans—with requirements phasing in over a three-year period. The new law also prevents backsliding in the case of the U.S. Department of Energy’s reversal or withdrawal of efficiency requirements for certain consumer, commercial and industrial products.
  • Hawaii’s HB 556 establishes minimum energy efficiency standards for certain appliances, including computers and monitors, certain fluorescent lamps, showerheads, faucets and spray sprinklers. The bill further empowers the director of business, economic development, and tourism to develop regulations necessary to enforce the new standards. 
  • Maine enacted HB 1071, which directs Maine Efficiency Trust to consider energy conservation programs that encourage the implementation of beneficial electrification of technologies that would otherwise rely on or require energy from fossil fuel. The state also enacted SB 597, establishing a statewide goal of installing 100,000 high-performance heat pumps and a new funding mechanism for Efficiency Maine Trust to encourage heat pump use.
  • Nevada’s AB 54 revises statutory provisions related to energy efficiency requirements for certain lights sold in the state.
  • New York’s AB 7779 requires the secretary of state to report to the governor, general assembly and senate leadership on the status of developing energy efficiency regulations for certain appliances. 
  • Washington’s HB 1444 establishes efficiency standards for certain appliances and products, including air compressors, computers and monitors, and certain fluorescent lamps.

Access to Energy Efficiency Programs 

A number of states also enacted legislation that touched on improving access to energy efficiency programs for low-and moderate-income households.

  • New York’s SB 6599 (described above) also requires that at least 35% of spending on clean energy and energy efficiency programs benefit disadvantaged communities.
  • Maine’s HB 1251 directs state agencies to make data relating to low-income households available to Maine Efficiency Trust to evaluate the effectiveness of its energy efficiency programs.
  • Virginia’s HB 2741 establishes a fund and pilot program dedicated to supporting the installation of solar and energy efficiency measures on low- and moderate-income households. 
  • Washington’s HB 1444 (described above) establishes new appliance standards in part to “help ensure renters have the same access to energy-efficient appliances as homeowners.”

Financing

States also continued to focus on financing energy efficiency improvements and programs, with at least nine states enacting bills on the topic. A number of states, including Illinois, Nebraska, Oklahoma, Utah and Virginia, enacted legislation amending their Property Assessed Clean Energy (PACE) laws, authorizing local governments to provide financing for energy efficiency and renewable energy improvements that the building owner repays through property tax assessments. 

  • IllinoisHB 3501 expands existing statutory definitions under the state’s PACE laws, including those related to energy efficiency improvements and alternative energy improvements, which include electric vehicle charging equipment. It also revises requirements for local government adoption of a PACE financing program and reporting.
  • Nebraska enacted two bills related to its PACE laws. The first, Legislative Document 23, expands the definition of energy efficiency improvement under its PACE financing law to include cogeneration and trigeneration energy recovery systems and empowers local governments to waive certain third-party lender review requirements upon approval of a property owner’s request for waiver. The second, Legislative Document 124, creates new requirements for joint clean energy assessment districts formed by multiple municipalities.
  • In Oklahoma, SB 1000 authorizes local governments to establish a PACE financing program and clarifies that exempt property under the state’s Energy Independence Act includes energy efficiency and building resiliency measures affixed to newly constructed or improved commercial buildings.
  • Utah’s HB 433 extends the state's PACE laws to apply to the Utah Inland Port Authority.
  • Virginia’s SB 1400 and SB 1559 make funding available under the state’s PACE financing laws for stormwater and water-management resiliency improvements respectively.

Additional funding-related efficiency bills enacted during the 2019 session include:

  • Maine’s HB 307 removes restrictions on Maine Efficiency Trust’s use of Regional Greenhouse Gas Initiative funds for residential and commercial programs.
  • Minnesota’s House File 2 establishes a new “Launch Minnesota” fund to support emerging tech businesses in a number of “high technology” areas including energy conservation and efficiency, renewable energy and environmental engineering among others.
  • In New York, AB 1606 creates new tax exemptions for projects that incorporate energy efficiency, green technologies and resource conservation measures.

As states map out their energy future with a focus on reducing consumption and cutting carbon emissions, legislatures will continue to consider new laws that broadly support energy conservation, and target improving efficiency in high energy-demand systems, including buildings and appliances. State legislatures are also increasingly focused on ensuring that all residents have equal access to clean and efficient technologies, and we anticipate lawmakers will continue to consider such policies in the years to come.