by Shane Henson — March 22, 2013—Congress and state policymakers could do much to help the U.S. economy through removing market barriers to investments in energy efficiency, says the American Council for an Energy-Efficient Economy (ACEEE) in a new report.
The report, Overcoming Market Barriers and Using Market Forces to Advance Energy Efficiency, highlights 16 policies that could be implemented to help in this endeavor, and provides lawmakers with a road map to address national energy consumption through policies that could save the country approximately $1 trillion in energy bills and 19 quads in energy consumption, says the ACEEE.
As the ACEEE notes, the United States has made much progress in energy efficiency in the last few decades, but there are still large, cost-effective opportunities available to advance efficiency even further, while improving the economy at the same time. However, a variety of market failures and market barriers contribute to keeping the nation from fully realizing its energy efficiency potential.
The report discusses several targeted policies that leverage market mechanisms and address specific market failures to energy efficiency, without requiring substantial spending or government mandates. For example, the development of a comprehensive building labeling and benchmarking program could save approximately 1.6 quads of energy and $60 billion between 2014 and 2030. Even more impressive are the benefits gained from adjusting corporate tax legislation to encourage the replacement of inefficient equipment and from removing regulatory barriers to combined heat and power projects. These two policies alone could reduce national energy consumption by 7 quads and save the economy close to $300 billion, the ACEEE explains.
The report includes policy interventions targeted at residential and commercial buildings, the industrial sector, and the transportation sector, as well as a number of policies with economy-wide benefits. For each measure, the report provides a brief description of the policy, its legislative history, general estimates of associated costs and benefits, and recommendations about future policy design.
