Robin Smutny-Jones Assistant Executive Director – CA Energy Commission

1. Energy Efficiency UpdateBefore the Senate Energy, Utilities &Communications CommitteePart 1May 17, 2011 – State Capitol Robin Smutny-Jones Assistant Executive Director – CA Energy Commission

2. Guiding Elements • Legislation • Warren Alquist Act (Division 15, PRC): created the CEC and established rate-payer (ERPA) funded efficiency programs for buildings and appliances. • AB 32 (Nunez, 2006): set ambitious climate change mitigation targets for CA. The Scoping Plan highlighted that improving energy efficiency of existing residential and nonresidential buildings is the single most important activity to reduce greenhouse gas emissions. • AB 758 (Skinner, 2009): directed the CEC to develop comprehensive statewide program to achieve energy savings in California’s existing building stock. • AB X4 1 (Evans, 2009), AB X4 11 (Evans, 2009), and AB 262 (Bass, 2009): authorized CEC to administer ARRA federal stimulus funds in coordination with other energy efficiency programs.

3. Guiding Elements (cont.) • Loading Order: establishes energy efficiency as highest priority over all other resources to meet California energy needs (SB 1037, Kehoe, 2006) • California Long-Term Energy Efficiency Strategic Plan (adopted by CPUC in 2007 in consultation with CEC and others): • Zero Net Energy for newly constructed buildings • 2020 for residential buildings • 2030 for commercial buildings • HVAC performance [consistent with AB 2021 (Levine, 2006)] • Deep retrofits in existing residential and nonresidential buildings

4. CEC Efficiency Programsfor Privately-Owned Buildings • Appliance Standards: minimum efficiency requirements for appliances and equipment offered for sale in California; development of appliance efficiency standards; maintenance of an appliance efficiency database • Building Standards: mandatory prescriptive and performance standards for newly constructed buildings and additions and alterations to existing buildings • Existing Buildings: • SB 1922 (Lewis, 1994) California Home Energy Rating System program • AB 549 (Longville, 2001) Report to the Legislature on recommendations to improve the energy efficiency of existing buildings • AB 1103 (Saldaña, 2007) Disclosure of energy consumption for commercial buildings at time of sale, lease or finance • AB 758 (Skinner, 2009) Statewide comprehensive energy efficiency program for existing buildings

5. Efficiency Results • California's building efficiency standards and appliance efficiency standards have saved more than $65 billion in electricity and natural gas costs since 1978 – about half of the savings of all energy efficiency in California. • Over this period California’s per capita electricity consumption has stayed approximately constant while that for the rest of the U.S. has almost doubled. • A RAND Corporation study found that between 1977 and 2000 California’s energy efficiency efforts resulted in a benefit to the state economy of about $1,100 (1998) for every citizen in California, a reduction of about 40% in air pollution from stationary sources, and a reduction in the burden of energy bills on low-income households.

6. ARRA Program Implementation Overarching Principles Preserve and create jobs and promote economic recovery. Assist those most impacted by the recession. Provide investments needed to increase economic efficiency by spurring technological advances in science and health. Invest in transportation, environmental protection and other infrastructure that will provide long-term economic benefits. Stabilize State and local government budgets in order to minimize and avoid reductions in essential services and counterproductive state and local tax increases.

7. ARRA Funding Programs CALIFORNIA ENERGY COMMISSION Administered ARRA-Funded Programs ($314.5 million) • State Energy Program (SEP): $226 million • Energy Efficiency and Conservation Block Grants: $49.6 million • State Energy Efficient Appliance Rebate Program: $35.2 million • Security-Related Energy Assurance Planning: $3.6 million

8. •Contracts and Program Support: $15.4 million ARRA Funding ProgramsAdministered ARRA-Funded Programs ($314.5 million total) State Energy Program (SEP): $226 million SEP Energy Efficiency Program: $110 million SEP Clean Energy Business Financing Program: $30.6 million Department of General Services (DGS): $25 million SEP/Energy Conservation Assistance Account (ECAA): $25 million Employment Development Department (EDD) and Employment Training Panel (ETP): $20 million EM&V, Program Audits, Program Administration: $15.4 million

9. •Contracts and Program Support: $15.4 million ARRA Funding ProgramsAdministered ARRA-Funded Programs ($314.5 million total) Energy Efficiency and Conservation Block Grants – $49.6 million CEC statewide administrator for grants to small cities and counties – at least 60% of the funding CEC discretionary contracts with local governments for special purposes State Energy Efficient Appliance Rebate Program – $35.2 million Appliance Rebates: $33.7 million Administration: Up to $1.5 million Security-Related Energy Assurance Planning – $3.6 million

10. Need for Statewide Collaboration • Many entities allocating funds to achieve energy upgrades in existing buildings: • DOE direct ARRA grants to local governments around state • DOE funding to CEC for statewide existing building market transformation • IOUs/SMUD developing whole-house upgrade programs • Local governments funding initiatives through own funds, including PACE • Independent unilateral development – inconsistent, incomplete or inadequate program features – hodgepodge of programs • Marketing and consumer outreach, contractor training, workforce development, quality assurance, program branding and messaging, financing availability and accessibility • Risk of consumer confusion, lack of program credibility, contractors faced with dysfunctional marketplace

11. Retrofit Market Barriers Upfront costs (financing) Uninformed consumers Lack of program coordination Lack of skilled workforce Lack of common assessment tool Lack of building stock information

12. Energy Upgrade California • Statewide energy and water efficiency and renewable energy upgrade program for single- and multi-family residential and commercial buildings • Unprecedented collaboration between Energy Commission, Public Utilities Commission, utilities, local governments and private sector • One-stop resource for information on building upgrade benefits, financing options, rebates and incentives, finding a qualified contractor, workforce training and home energy ratings • Coordinates federal, state, utility and local government program outreach, incentives and contractor/participant qualifications • Offers pilot platform for AB 758 program infrastructure

15. Looking Forward • Zero Net Energy • 2013 Building Standards adoption proceeding • SB 1 determination of How to Incorporate PVs in Building Standards • ZNE Action Plan collaboration with CPUC and ARB – steps to 2020 • “Reach” standards for inclusion in CA Green Building Standards code and local ordinances • Strategic Appliance Standards for lighting (SB 1103), equipment • AB 758 Comprehensive Program for Existing Buildings • Address all mandated program components: public awareness, workforce development, financing options, energy performance ratings and disclosure, efficiency recommendations and improvements • ARRA-Funded Programs are pilots for exploring all program components • Collaborate with Energy Upgrade Partners – CPUC, utilities, local governments, private sector