FEATURE – 16 policies to remove market barriers to energy efficiency
March 26, 2013 - The American Council for an Energy-Efficient Economy (ACEEE) has highlighted 16 policies to help remove market barriers across the economy to investments in energy efficiency in a new report.
The report, Overcoming Market Barriers and Using Market Forces to Advance Energy Efficiency, provides government and policymakers a road map to address national energy consumption through policies that could save the United States about $1 trillion in energy bills and 19 quads in energy consumption, it estimated.
While the report acknowledged much progress in energy efficiency had been made in the last few decades, it stated a “variety of market failures and market barriers contribute” as obstacles in realizing one’s energy efficiency potential.
“Eliminating barriers that keep us from reducing waste is an approach both sides of the aisle can support,” said ACEEE executive director Steven Nadel. “By removing these barriers, Congress and state policymakers have an opportunity to let smart investments help strengthen the economy while saving the nation billions.”
The report noted several targeted policies to help 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 labelling and benchmarking program could save approximately 1.6 quads of energy and $60 billion between 2014 and 2030, it predicted. 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 (CHP) projects. These two policies alone could reduce national energy consumption by 7 quads and save the economy close to $300 billion, it said.
“We want to show policymakers that there are a number of cost-effective policies out there that could promote energy efficiency and kick start the economy at the same time,” said lead author and ACEEE senior research analyst Shruti Vaidyanathan. “This report highlights a number of inventive approaches that we haven’t made much use of to date.”
The American Council for an Energy-Efficient Economy (ACEEE) acts as a catalyst to advance energy efficiency policies, programs, technologies, investments, and behaviours.