S. Rept. 111-332 - 111th Congress (2009-2010)
September 27, 2010, As Reported by the Energy and Natural Resources Committee

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Senate Report 111-332 - 10 MILLION SOLAR ROOFS ACT




[Senate Report 111-332]
[From the U.S. Government Printing Office]


                                                       Calendar No. 618
111th Congress                                                   Report
  2d Session                  SENATE                            111-332
=======================================================================
 
                       10 MILLION SOLAR ROOFS ACT 

                                _______
                                

               September 27, 2010.--Ordered to be printed

                                _______
                                

   Mr. Bingaman, from the Committee on Energy and Natural Resources, 
                        submitted the following

                              R E P O R T

                         [To accompany S. 3460]

    The Committee on Energy and Natural Resources, to which was 
referred the bill (S. 3460) to require the Secretary of Energy 
to provide funds to States for rebates, loans, and other 
incentives to eligible individuals or entities for the purchase 
and installation of solar energy systems for properties located 
in the United States, and for other purposes, having considered 
the same, reports favorably thereon with an amendment and an 
amendment to the title and recommends that the bill, as 
amended, do pass.
    The amendments are as follows:
    1. Strike out all after the enacting clause and insert in 
lieu thereof the following:

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``10 Million Solar Roofs Act of 
2010''.

SEC. 2. DEFINITIONS.

    In this Act:
          (1) Eligible participant.--The term ``eligible participant'' 
        means--
                  (A) an owner of a home;
                  (B) a business entity;
                  (C) a local educational agency; and
                  (D) any other individual or entity that the Secretary 
                determines to be appropriate.
          (2) Indian tribe.--The term ``Indian tribe'' has the meaning 
        given the term in section 4 of the Indian Self-Determination 
        and Education Assistance Act (25 U.S.C. 450b).
          (3) Installed nameplate capacity.--The term ``installed 
        nameplate capacity'' means the maximum output of a solar 
        electric system under specific conditions designated by the 
        manufacturer of the solar electric system.
          (4) Local educational agency.--The term ``local educational 
        agency'' has the meaning given the term in section 9101 of the 
        Elementary and Secondary Education Act of 1965 (20 U.S.C. 
        7801).
          (5) Secretary.--The term ``Secretary'' means the Secretary of 
        Energy.
          (6) Solar energy system.--The term ``solar energy system'' 
        means rooftop or ground-mounted solar equipment--
                  (A) that is used to generate electricity or heat 
                water; and
                  (B) with an installed nameplate capacity not 
                exceeding 1 megawatt or the thermal equivalent of 1 
                megawatt.

SEC. 3. REBATES, LOANS, AND OTHER INCENTIVES FOR PURCHASE AND 
                    INSTALLATION OF SOLAR ENERGY SYSTEMS.

    (a) In General.--As soon as practicable after the date of enactment 
of this Act, the Secretary shall establish a program under which the 
Secretary shall provide competitive grants to States, Indian tribes, 
and local governments to provide rebates, loans, or other incentives to 
eligible participants for the purchase and installation of solar energy 
systems for properties located in the United States.
    (b) Implementation.--
          (1) Competitive grants.--
                  (A) In general.--For each fiscal year, the Secretary 
                shall provide competitive grants to States, Indian 
                tribes, and local governments to be used in accordance 
                with this section.
                  (B) Requirements.--The Secretary shall adopt and 
                implement criteria for awarding competitive grants 
                under subparagraph (A) to States, Indian tribes, and 
                local governments that would--
                          (i) provide the maximum leverage of Federal 
                        funds;
                          (ii) provide for the maximum deployment of 
                        solar energy;
                          (iii) ensure that grants are awarded to a 
                        diversity of geographic locations and 
                        recipients with different population sizes;
                          (iv) provide not less than 2 percent of the 
                        funds available to Indian tribes and consortia 
                        of Indian tribes; and
                          (v) provide a preference for grant recipients 
                        that have established and maintained, or agree 
                        to commit to establish and maintain, standards 
                        and policies to overcome barriers to 
                        distributed generation (including 
                        interconnection and net metering) in a manner 
                        consistent with the legal authorities of the 
                        grant recipient.
          (2) Authorized use of funds.--Subject to subsection (c), 
        competitive grants provided under this section may be used to 
        expand an existing, or establish and fund a new--
                  (A) solar rebate program;
                  (B) solar loan program;
                  (C) solar performance-based incentive program; or
                  (D) solar incentive program, solar deployment program 
                or project, or innovative solar financing program not 
                described in subparagraphs (A) through (C), as 
                determined by the Secretary.
          (3) Program requirements.--For each fiscal year during which 
        a grant recipient uses funds provided under this section, the 
        grant recipient shall--
                  (A) certify to the Secretary that the funds will be 
                used--
                          (i) to supplement, expand, or create new 
                        programs or projects and will not supplant 
                        existing programs as to maximize program 
                        participation; and
                          (ii) to deploy an increased quantity of solar 
                        energy systems; and
                  (B) submit to the Secretary an implementation plan 
                that contains--
                          (i) projections for solar energy systems 
                        deployment;
                          (ii) data regarding the number of eligible 
                        participants that are assisted under existing 
                        applicable State and local programs; and
                          (iii) projections for--
                                  (I) additional solar energy system 
                                deployment; and
                                  (II) the number of additional 
                                eligible participants who will be 
                                covered by the annual implementation 
                                plan.
    (c) Solar Energy System.--With respect to grant awards in any 
fiscal year under this section, the Secretary may specify the type and 
capacity of the solar energy system and type of deployment or incentive 
program for which the grant funds are made available.
    (d) Non-Federal Share.--Each eligible entity that receives funds 
under this section shall be responsible for an amount equal to 20 
percent of the amount of the provided funds.
    (e) Administrative Expenses.--
          (1) In general.--Not more than 5 percent of the amounts made 
        available for each fiscal year under this section may be used 
        to pay the administrative expenses of the Department of Energy 
        that the Secretary determines to be necessary to carry out this 
        Act (including expenses arising from monitoring and 
        evaluation).
          (2) ELigible entities; other grant recipients.--Grant 
        recipients may use amounts made available for each fiscal year 
        under this section to pay for administrative expenses in 
        accordance with section 545(b)(3)(A) of the Energy Independence 
        and Security Act of 2007 (42 U.S.C. 17155(b)(3)(A)).
    (f) Relationship to Other Law.--An eligible participant that 
receives a rebate under this section shall not be eligible for a rebate 
under section 206(c) of the Energy Policy Act of 2005 (42 U.S.C. 
15853).
    (g) Coordination; Consultation.--To the maximum extent practicable, 
the Secretary shall consult with the Secretary of the Treasury and the 
Chief Executive of each grant recipient that receives funds under this 
section to ensure that each program carried out by each grant recipient 
through the use of the funds is coordinated with each other applicable 
incentive or financing program of the Federal Government or any other 
applicable program.
    (h) Maximum Incentive.--
          (1) In general.--With respect to each rebate, grant, and tax 
        credit provided to an eligible participant under this section, 
        the aggregate value of the grants, rebates, and tax credits may 
        not exceed 50 percent of the cost to the purchaser of the 
        purchase and installation of the solar energy system.
          (2) Effect.--Nothing in this subsection affects any solar 
        loan or financing program under this section or any other law 
        (including regulations).
    (i) Goal.--It is the goal of the United States, through this Act 
and any appropriate incentive or research and development program, to 
install distributed solar energy systems on not less than 10,000,000 
properties located in the United States by December 31, 2021.
    (j) Report Regarding Additional Recommendations.--Not later than 
270 days after the date of enactment of this Act, the Secretary shall 
submit to the Committee on Energy and Natural Resources of the Senate 
and the Committee on Energy and Commerce of the House of 
Representatives a report that contains additional recommendations that 
the Secretary determines to be necessary to achieve the goal described 
in subsection (i), including any modification to the program 
established under subsection (a).
    (k) Authorization of Appropriations.--There are authorized to be 
appropriated to the Secretary to carry out this section--
          (1) for fiscal year 2012, $250,000,000; and
          (2) for each of fiscal years 2013 through 2021, such sums as 
        are necessary.
    Amend the title so as to read: ``A bill to require the 
Secretary of Energy to provide competitive grants to States, 
Indian tribes, and local governments for rebates, loans, and 
other incentives to eligible individuals or entities for the 
purchase and installation of solar energy systems for 
properties located in the United States, and for other 
purposes.''.

                                PURPOSE

    The purpose of S. 3460 is to require the Secretary of 
Energy to provide funds to States, Indian tribes, and local 
governments to provide rebates, loans, and other incentives to 
eligible participants for the purchase and installation of 
solar energy systems for properties located in the United 
States.

                          BACKGROUND AND NEED

    Despite the various state and federal financial incentives 
available to homeowners, such as the 30 percent federal tax 
credit in place through 2016, financing the cost of a 
residential photovoltaic (PV) and solar hot water heating 
systems remains challenging. Like other renewable energy 
technologies, the cost structure of solar energy systems is 
front-loaded with a high initial investment, followed by modest 
maintenance expenses, and essentially zero fuel costs. While 
the tax credit provides a significant consumer incentive by 
reducing the overall system price, it does not fully address 
the key barrier to adoption--high upfront capital cost. 
Proponents of the bill believe that if the proper incentives 
and structures can be put into place, the opportunity for 
residential PV and solar hot water heating is significant. 
According to Navigant Consulting, the nation's residential and 
commercial rooftop space could accommodate up to 710,000 
megawatts of solar electric power. For comparison, total 
electricity-generating capacity in the U.S. today is about 
950,000 megawatts.

                          LEGISLATIVE HISTORY

    S. 3460 was introduced by Senator Sanders on June 7, 2010, 
and is cosponsored by Senators Specter, Cardin, Whitehouse, 
Kaufman, Gillibrand, Stabenow, Leahy, Boxer, Casey, Harkin, 
Lautenberg, Menendez, Merkley, Kerry, Cantwell, and Shaheen. 
The Subcommittee on Energy held a hearing on S. 3460 on June 
15, 2010. At its July 21, 2010, business meeting the Committee 
on Energy and Natural Resources considered the bill, agreed to 
an amendment in the nature of a substitute, and an amendment to 
the long title, and agreed to the bill, as amended, on July 21, 
2010, but lacked a sufficient quorum to report the bill. At its 
business meeting on August 5, 2010, the Committee ordered S. 
3460 to be favorably reported, as previously amended.

                        COMMITTEE RECOMMENDATION

    The Committee on Energy and Natural Resources, in open 
business session on August 5, 2010, by a unanimous voice vote 
of a quorum present, recommends that the Senate pass S. 3460, 
if amended as described herein.

                          COMMITTEE AMENDMENTS

    During its consideration of S. 3460, the Committee adopted 
an amendment in the nature of a substitute, as described in the 
section-by-section analysis, and an amendment to the title. 
Significant changes from the original bill language include 
directing the Secretary to establish a competitive grant 
program to award funds to States, Indian tribes, and local 
governments instead of using the State Energy Program formula 
to award funding to States only. The amendment also adds the 
additional requirement that the Secretary design criteria for 
awarding competitive grants that: provide for the maximum 
leverage of federal funds as well as the maximum deployment of 
solar energy; ensure geographic and population diversity; 
provide at least 2 percent of the available funds to Indian 
tribes; and provide a preference for grant recipients that have 
established and maintained or agree to establish and maintain, 
standards and policies to overcome barriers to distributed 
generation in a manner consistent with the legal authorities of 
the grant recipient. Lastly, the amendment requires that with 
respect to each rebate, grant, and tax credit provided to an 
eligible participant under the program established by this Act, 
the aggregate value of the funding may not exceed 50 percent of 
the cost to the purchaser of the purchase and installation of 
the solar energy system.

                      SECTION-BY-SECTION ANALYSIS

    Section 1 sets forth the short title.
    Section 2 defines key terms used in the bill.
    Section 3(a) directs the Secretary to establish a program 
to provide competitive grants to States, Indian tribes, and 
local governments to provide rebates, loans, or other 
incentives to eligible participants for the purchase and 
installation of solar energy systems for properties located in 
the United States.
    Subsection (b) directs the implementation of the program 
described in subsection (a). Paragraph (1) requires the 
Secretary to design criteria for awarding competitive grants 
that would: provide maximum leverage of federal funds; provide 
for the maximum deployment of solar energy; ensure geographic 
and population diversity in grants awarded; provide not less 
than 2 percent of the available funds to Indian tribes; and 
provide a preference for grant recipients that have established 
and maintained or agree to establish and maintain, standards 
and policies to overcome barriers to distributed generation in 
a manner consistent with the legal authorities of the grant 
recipient. Paragraph (2) authorizes competitive grant funds to 
be used to expand an existing or to establish and fund a new: 
solar rebate program; solar loan program; solar performance-
based incentive program; or other solar deployment incentives 
or innovative solar financing programs as approved by the 
Secretary. Paragraph (3) requires that for each fiscal year, 
grant recipients must submit an implementation plan for the 
funds to the Secretary of Energy. The grant recipient must also 
certify to the Secretary that the awarded federal funds will 
expand or supplement, but not supplant, any existing solar 
programs, and will deploy additional solar energy systems.
    Subsection (c) authorizes the Secretary to specify the type 
and capacity of the solar energy system and type of deployment 
or incentive program eligible for grant funds.
    Subsection (d) establishes a non-federal cost match of 20 
percent for grant recipients.
    Subsection (e) authorizes the Department of Energy to use 
up to five percent of the funds made available for each fiscal 
for administrative expenses. Grant recipients are permitted to 
use funds for administrative expenses consistent with the 
administrative expense requirements of the Energy Efficiency 
and Conservation Block Grant program, set forth in section 
545(b)(3)(A) of the Energy Independence and Security Act of 
2007 (42 U.S.C. 17155(b)(3)(A)).
    Subsection (f) states that an eligible participant that 
receives a rebate under this section shall not be eligible for 
a rebate under section 206(c) of the Energy Policy Act of 2005 
(42 U.S.C. 15853).
    Subsection (g) directs the Department of Energy to consult 
with the Department of the Treasury and grant recipients to 
ensure that each program carried out by the grant recipient is 
coordinated with other applicable incentive or financing 
programs of the Federal Government or any other applicable 
program.
    Subsection (h) requires with respect to each rebate, grant, 
and tax credit provided to an eligible participant under the 
program established under subsection (a), the aggregate value 
of the grants, rebates, and tax credits may not exceed 50 
percent of the cost to the purchaser of the purchase and 
installation of the solar energy system.
    Subsection (i) establishes the national goal of achieving 
through this Act and any appropriate incentive or research and 
development program to install distributed solar energy systems 
on not less than 10,000,000 properties located in the United 
States by December 31, 2021.
    Subsection (j) requires that the Department of Energy issue 
a report to Congress detailing recommendations necessary 
through this and other programs to meet the goal established in 
subsection (j) within 270 days after enactment of this Act.
    Subsection (k) authorizes appropriations of $250 million 
for fiscal year 2012 and such sums as are necessary for fiscal 
years 2013 through 2021.

                   COST AND BUDGETARY CONSIDERATIONS

    The following estimate of costs of this measure has been 
provided by the Congressional Budget Office.

S. 3460--10 Million Solar Roofs Act of 2010

    Summary: S. 3460 would authorize the appropriation of $250 
million in 2012 and whatever sums are necessary in each of 
fiscal years 2013 through 2021 for the Department of Energy 
(DOE) to make grants to states to support installations of 
solar energy systems for eligible homes, businesses, and other 
structures. Assuming appropriation of the authorized and 
necessary amounts, CBO estimates that implementing S. 3460 
would cost $617 million over the 2011-2015 period. Enacting S. 
3460 would not affect direct spending or revenues; therefore, 
pay-as-you-go procedures do not apply.
    S. 3460 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA).
    Estimated cost to the Federal Government: The estimated 
budgetary impact of S. 3460 is shown in the following table. 
The costs of this legislation fall within budget function 270 
(energy).

----------------------------------------------------------------------------------------------------------------
                                                                    By fiscal year, in millions of dollars--
                                                              --------------------------------------------------
                                                                2011    2012    2013    2014    2015   2011-2015
----------------------------------------------------------------------------------------------------------------
                                  CHANGES IN SPENDING SUBJECT TO APPROPRIATIONEstimated Authorization Level................................       0     250     254     259     264      1,027
Estimated Outlays............................................       0      75     150     183     209        617
----------------------------------------------------------------------------------------------------------------

    Basis of estimate: S. 3460 would authorize the 
appropriation of $250 million in 2012 and whatever sums are 
necessary over the 2013-2021 period for DOE to make grants to 
state and local governments to provide rebates, loans, and 
other incentives to homeowners, businesses, and other eligible 
participants that purchase and install solar energy systems. 
(By comparison, DOE reports that the agency's funding for 
research and development related to solar energy technologies 
in 2010 totaled about $230 million.)
    For this estimate, CBO assumes that funding levels over the 
2013-2021 period would remain at the $250 million level 
specified for 2012, adjusted for anticipated inflation. 
Assuming appropriation of those amounts and spending patterns 
consistent with similar DOE grant programs, CBO estimates that 
resulting outlays would total $617 million over the 2012-2015 
period. Under the bill's authorized funding through 2021, such 
spending would continue after 2015, with annual outlays 
averaging about $275 million a year for several years after 
2015. Based on information from DOE, CBO estimates that those 
amounts would support the installation of at least 100,000 
solar energy systems annually.
    Pay-as-you-go considerations: None.
    Intergovernmental and private-sector impact: S. 3460 
contains no intergovernmental or private-sector mandates as 
defined in UMRA. State, local, and tribal governments would 
benefit from grants authorized by the bill. Any costs to those 
governments would be incurred voluntarily as a condition of 
federal assistance.
    Estimate prepared by: Federal Costs: Megan Carroll; Impact 
on State, Local, and Tribal Governments: Ryan Miller; Impact on 
the Private Sector: Amy Petz.
    Estimate approved by: Theresa Gullo, Deputy Assistant 
Director for Budget Analysis.

                      REGULATORY IMPACT EVALUATION

    In compliance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee makes the following 
evaluation of the regulatory impact which would be incurred in 
carrying out S. 3460.
    The bill is not a regulatory measure in the sense of 
imposing Government established standards or significant 
economic responsibilities on a private individuals and 
businesses.
    No personal information would be collected in administering 
the program. Therefore, there would be no impact on personal 
privacy.
    Applying for grants authorized by S. 3460 may impose some 
additional paperwork on the States, Indian tribes, and local 
governments applying for the grants, and will require grant 
recipients to submit implementation plans and certify how the 
funds will be used. The Committee does not expect these 
additional paperwork burdens to be substantial in either time 
or financial cost.

                   CONGRESSIONALLY DIRECTED SPENDING

    S. 3460, as ordered reported, does not contain any 
congressionally directed spending items, limited tax benefits, 
or limited tariff benefits as defined in rule XLIV of the 
Standing Rules of the Senate.

                        EXECUTIVE COMMUNICATIONS

    The views of the Administration on S. 3460 are included in 
the testimony from the Department of Energy received by the 
Committee at its June 15, 2010, hearing, which is set forth 
below:

Statement of Steven G. Chalk, Chief Operating Officer and Acting Deputy 
 Assistant Secretary for Renewable Energy, Office of Energy Efficiency 
               and Renewable Energy, Department of Energy

    Madam Chairman, Ranking Member Risch, and Members of the 
Subcommittee, thank you for the opportunity to appear before 
you today to discuss proposed clean energy legislation.
    The Department and the Subcommittee share common goals of 
strengthening our economy, enhancing our national security, and 
protecting our environment. As part of the Recovery Act, the 
Office of Energy Efficiency and Renewable Energy (EERE), 
oversees a total of $16.8 billion in investments. To date, EERE 
has obligated 96 percent, or $16.07 billion, of its Recovery 
Act funds. The funds are putting America to work laying the 
foundation for our clean energy future. The Department also 
appreciates the authorities you have provided in recent years 
in the Energy Policy Act of 2005 (EPAct) (P.L. 109-58) and the 
Energy Independence and Security Act of 2007 (EISA) (P.L. 110-
140). This year, the Committee has proposed further investment 
and we thank you for all your hard work in reporting the 
American Clean Energy Leadership Act (S. 1462).
    Today, I am pleased to offer the Department's perspective 
on five pending pieces of legislation related to energy 
efficiency and renewable energy. Note that many of the 
authorities outlined in the bills would simply reinforce 
existing authorities, and may not be necessary for the 
Department to carry out the activities in question. I will 
discuss them in the order listed in the hearing invitation 
letter I received from the Subcommittee. These include the 10 
Million Solar Roofs Act of 2010 (S. 3460), the Supply Star Act 
of 2010 (S. 3396), the Improving Energy Efficiency and 
Renewable Energy Use By Federal Agencies Act of 2010 (S. 3251), 
the Heavy Duty Hybrid Vehicle Research, Development, and 
Demonstration Act (S. 679), the Gas Turbine Efficiency Act of 
2009 (S. 2900).


              s. 3460--10 million solar roofs act of 2010


    We thank the subcommittee and the sponsor of this 
legislation for your strong leadership on solar technologies 
over the years. The Department's goals for solar electric 
technologies are to be cost competitive in their respective 
markets by 2015 and to reach a high penetration of solar 
installations. The Department is investing $232 million in 2010 
to support solar research across the development pipeline, from 
basic photovoltaic (PV) cell technologies to manufacturing 
scaleup to total system development. Within the $232 million, 
DOE is investing up to $50 million in concentrated solar power 
technology development and deployment related activities and 
$23 million to understand how solar technologies can be better 
integrated within existing electricity generation and 
transmission systems. In solar hot water heating, DOE is 
investing approximately an additional $6.5 million in 2010.
    The proposed legislation incorporates several significant 
features. We believe that rebates, loan programs, and 
performance based incentives are all effective means of 
stimulating demand. Allowing states to choose between these 
incentives will enable the Act to expand existing state 
programs that have been effective in promoting solar 
installations. In addition, the states' matching funds 
requirements will leverage available federal appropriations and 
increase the resulting deployment of solar technologies, both 
of which are high priorities for the Department.
    To maximize the effectiveness of the proposed legislation, 
we would recommend two changes. First, while we support the 
state match requirement, we propose that the cost share be set 
at 50 percent to increase the potential leverage of federal 
funds. Second, the Secretary should be given the ability to 
reduce this as necessary to increase the overall effectiveness 
of the program. We also believe the program could be designed 
in a creative way such as working with municipalities to 
promote photovoltaic installations through innovative local 
programs.
    We note that by our estimates, the $250 million authorized 
for FY 2012 would yield roughly 100,000 rooftop solar systems, 
and may not be sufficient to put us on a trajectory to meet the 
goal of 10 million solar roofs. With these changes, the 
legislation could be an effective tool in increasing deployment 
of solar electricity technologies Nationwide. We note that 
existing authorities, such as the competitive portion of the 
state energy program, would allow DOE to undertake such a 
program already.


                    s. 3396--supply star act of 2010


    Supply chain energy efforts can make an important 
contribution to overall industrial efficiency and the 
competitive position of domestic suppliers. Analysis suggests 
that a large part of the carbon footprint for many consumer 
products can be attributed to the supply chain--from raw 
materials, transport, and packaging to the energy consumed in 
manufacturing processes--on the order of 40 to 60 percent.\1\
---------------------------------------------------------------------------
    \1\Source: Climate Change and Supply Chain Management, McKinsey 
Quarterly, McKinsey & Company, July 2008.
---------------------------------------------------------------------------
    The Supply Star legislation seeks to build upon existing 
best practices in the industrial community by establishing a 
voluntary recognition program that supports and promotes 
products and companies with highly energy- and resource-
efficient supply chains.
    DOE and the Environmental Protection Agency (EPA) both have 
existing initiatives that address supply chain efficiency, such 
as Save Energy Now' at DOE and the Smart Way 
Transport\TM\ program at EPA. The legislation should coordinate 
with and leverage these programs as a structure through which 
Supply Star activities could be conducted. For example, through 
its national Save Energy Now' initiative, DOE 
encourages manufacturing companies to engage their supply 
chains in energy and carbon management. Specifically, DOE 
develops processes and resources to assist companies in 
promoting energy management to their industrial suppliers and 
customers. Save Energy Now' LEADER Companies make a 
voluntary commitment to reduce their energy intensity by 25 
percent in 10 years. Many of these companies are interested in 
improving the efficiency of their supply chains as well.
    The Supply Star bill also builds upon Superior Energy 
Performance (SEP), a voluntary certification program working to 
provide industrial facilities with a roadmap for achieving 
continual improvement in energy efficiency while maintaining 
competitiveness. A central element of SEP is implementation of 
the forthcoming International Organization for Standardization 
(ISO) 50001 energy management standard, with additional 
requirements to achieve and document energy intensity 
improvements. DOE is working through SEP to bring ISO 50001 to 
the U.S. Upon its expected publication in 2011 this American 
National Standards Institute-accredited program will provide 
companies with a framework for fostering energy-efficiency at 
the plant level and a consistent methodology for measuring and 
validating energy efficiency and intensity improvements. This 
new framework will be an important tool to integrate into 
supply chain efforts.


   s. 3251--improving energy efficiency and renewable energy use by 
                      federal agencies act of 2010


    On October 5th, President Obama signed Executive Order 
13514 requiring Federal agencies to set GHG emission reduction 
targets, increase energy efficiency, reduce fleet petroleum 
use, conserve water, reduce waste and promote environmentally-
responsible produce purchases by federal agencies. With this 
action, the President directed agencies to demonstrate the 
Federal government's commitment, over and above what is already 
being done, to reducing emissions and saving money.
    As a whole, the Federal government has made significant 
progress in meeting the energy requirements of EISA 2007 and 
EPAct 2005. Further progress on these efforts would be 
bolstered by S. 3251. The Department is particularly supportive 
of provisions clarifying the definition of allowable 
``renewable'' energy sources, and authorizing the creation of a 
revolving fund for Federal facility energy efficiency and 
renewable energy projects.
    The Department looks forward to working with the 
Subcommittee on legislation that would provide agencies with 
the flexibility to purchase renewable energy for appropriate 
time periods, that do not exceed asset life, create appropriate 
risk sharing between project developers and taxpayers, and that 
recognize the importance of fiscal responsibility and 
Congressional Budget Office scoring of contracts. This 
authority would provide opportunities for more on-site 
renewable power at Federal agencies and would provide strong 
support for growing our domestic clean energy economy.
    The Department's recommended definition of renewable energy 
follows the definition in section 203 of EPAct 2005, with an 
additional recommendation to allow for both electric energy and 
thermal energy from renewable sources. It is very important to 
allow thermal energy to count as renewable energy, particularly 
because renewable thermal energy sources such as ground source 
heat pumps are often the lowest-cost option for displacing 
purchased energy and are already widely deployed. This approach 
contrasts with the current definition which is limited only to 
``renewable electricity,'' a definition that reduces incentives 
for this valuable and cost-effective form of renewable power.
    The Department fully supports the creation of a revolving 
loan fund based on best practices and subject to appropriate 
interest rates for Federal facility energy efficiency and 
renewable energy projects. There is considerable experience and 
success at the state and local level with using revolving loan 
funds to assist innovative projects to improve energy 
efficiency. In addition, there is Federal experience with a 
similar concept within the General Services Administration 
(GSA) that funds agency relocations, and agencies reimburse the 
fund at slightly above costs to gradually increase the amount 
of funds available for lending.
    Federal agencies are already responding to the requirements 
of EISA Section 432 to survey their facilities for potential 
energy efficiency and renewable energy upgrades, as well as to 
complete energy audits and to report on measures taken. The 
Department recommends that the renewable energy facility 
surveys called for in S. 3251 Section 5 should be included as a 
modification of EISA Section 432.
    DOE's Federal Energy Management Program is already at work 
implementing provisions similar to the Federal energy 
management and data collection standard called for in S. 3251 
Section 7. As required under EISA Section 432, DOE will publish 
overarching guidance for implementation of all Section 432 
requirements in 2010. The Department is also developing a web-
based tracking system for facility-level energy data and 
identified or implemented energy conservation measures per 
EISA. Tasking the GSA to deploy a similar publicly-available 
resource with facility-level energy data would create 
redundancy as the Department's compliance tracking system will 
be deployed for use by all agencies in July 2010.


     s. 679--heavy duty hybrid vehicle research, development, and 
                           demonstration act


    The program authorized by S. 679 would complement several 
of the Department's current activities focused on increasing 
vehicle energy efficiency. One of those programs is the 
SuperTruck Program, in which DOE is seeking to improve the 
freight hauling efficiency of Class 8 trucks by 50 percent. 
Other complementary efforts underway include: (1) the 
development of hybrid school bus technology; (2) research, 
development, and demonstration of medium-duty utility bucket 
trucks and passenger shuttles using a plug-in hybrid electric 
system; and (3) other medium and heavy duty truck deployment 
activities supported by our Clean Cities program. S. 679 has 
the potential to increase the fuel economy attainable by 
vehicles in this sector.
    There are several technical definitions and reporting 
requirements about which we would like to seek clarification, 
and the Department looks forward to working with the 
subcommittee on those provisions.


              s. 2900--gas turbine efficiency act of 2009


    The Gas Turbine Efficiency Act would establish a research, 
development, and technology demonstration program to improve 
the efficiency of gas turbines used in combined cycle and 
simple cycle power generation systems.
    The Department believes that industry has economic 
incentives to invest in research, development and demonstration 
to increase the efficiency of gas turbines. To the extent that 
the private sector underinvests in basic research, DOE has 
sufficient authority and existing programs to improve high 
temperature materials applicable to a range of energy 
technologies.
    The bill is similar to an existing successful program 
within DOE. The Advanced Turbine Systems Program, a research, 
development and demonstration collaborative between the 
Department's Offices of Energy Efficiency and Renewable Energy 
and Fossil Energy, successfully developed and deployed advanced 
turbine material and coating leading to today's turbine 
efficiencies.
    The legislation outlines activities DOE already performs. 
For example, through its Industries of the Future 
(crosscutting) investments, DOE's Industrial Technology Program 
(ITP) aids the development of advanced manufacturing processes 
for the expanded use of lightweight materials such as titanium. 
Those breakthroughs help to drive production cost down and 
market impact up. In other efforts, ITP promoted advanced 
alloys of steel to support many of the new clean energy 
products being developed today. Nanocoating technologies are 
still another group of innovations developed with the 
assistance of ITP that now extend the life of tooling systems 
and provide wear resistance to reduce the cost of manufacture 
and extend the useful life of products. All of these efforts 
support the overarching objective of reducing the energy 
intensity of Industry to help advance the Administration's 
energy security and environmental performance goals.
    The Department is committed to continuing research of high 
temperature materials which will help industry develop more 
efficient energy technologies. Meanwhile, the private sector 
has economic incentive to invest in the development and 
demonstration of efficient gas turbines. Therefore, private 
sector work on later stages of efficient natural gas turbine 
development and demonstration will likely be conducted without 
the need for additional funding authorizations beyond that 
already in place.
    In conclusion, the Department of Energy thanks the 
Subcommittee for the opportunity to comment on these proposed 
initiatives. We look forward to working with Congress to 
develop strong, effective clean energy policy to ensure U.S. 
leadership on these global issues and in the clean energy 
economy.

                        CHANGES IN EXISTING LAW

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, the Committee notes that no 
changes in existing law are made by S. 3460, as ordered 
reported.