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EERE Network News -- 08/10/05

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  • EERE Network News by way of Tom Gray
    [] [] A weekly newsletter from the U.S. Department of Energy s (DOE) Office of Energy Efficiency and Renewable Energy (EERE). The
    Message 1 of 1 , Aug 10, 2005
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      A weekly newsletter from the U.S. Department of Energy's (DOE)
      <http://www.eere.energy.gov/>Office of Energy Efficiency and Renewable
      Energy (EERE). The EERE Network News is also available on the Web at:

      August 10, 2005

      News and Events

      * Energy Act Provides Tax Incentives for Energy Efficiency
      * Net Metering, Tax Credits for Solar Energy Included in Energy Act
      * Power Production from Renewable Energy Aided by Energy Act
      * Biofuel Requirement and Tax Incentives Included in Energy Act
      * Energy Act to Increase Energy Efficiency in Federal Buildings
      * Energy Act Shifts Daylight Saving Time, Sets Appliance Standards

      Energy Connections

      * EIA: High Crude Oil Prices Push Other Fuel Costs Higher

      News and Events

      Energy Act Provides Tax Incentives for Energy Efficiency


      Closeup photo of the President's hand signing the energy bill,

      President Bush signed the energy bill on August 8th.
      Credit: Eric Draper, White House

      President Bush signed the Energy Policy Act of 2005 into law on Monday,
      setting in motion a process that will yield new tax incentives for
      consumers and businesses that pursue energy efficiency. "Energy
      conservation is more than a private virtue; it's a public virtue," said
      President Bush. "And with this bill I sign today, America is taking the
      side of consumers who make the choice to conserve." See the
      House press release,
      Bush's comments, and the White House's related
      "<http://www.whitehouse.gov/infocus/energy/>Energy for America's Future"
      Web page.

      The energy act creates a total tax credit of up to $500 for energy
      efficiency improvements to your home, including credits of up to $200 for
      installing new exterior windows; up to $300 for installing a highly
      efficient central air conditioner, heat pump, or water heater; up to $150
      for installing a highly efficient furnace or boiler; and credits for 10
      percent of the cost of insulation, energy-efficient doors, and cool
      reflective roofs. The credits will be available in 2006 and 2007. DOE also
      anticipates possible consumer savings as a result of new tax credits for
      contractors who build energy-efficient homes and for manufacturers who make
      energy-efficient appliances. New energy-efficient commercial buildings will
      also earn a tax deduction.

      Buying hybrid electric vehicles and vehicles with cleaner burning diesel
      engines, known as advanced lean-burn engines, can earn you a tax credit of
      up to $3,400. The credit is largest for the vehicles that save the most
      fuel, but the credit will phase out shortly after an automaker sells 60,000
      eligible cars. Tax credits of up to $4,000 are also available for
      alternative fuel cars. Businesses can earn the same tax credits, as well as
      credits of up to $12,000 for buying large hybrid vehicles, such as buses,
      and up to $32,000 for the purchase of large alternative fuel vehicles. And
      although fuel cell vehicles are not on the market yet, the act also
      establishes tax credits for these vehicles. See
      Bill Signed" on the DOE Web site and the
      <http://www.ase.org/content/news/detail/2384>Alliance to Save Energy press

      For more information, see pages 1332 to 1433 of the full 1,724-page energy
      act (also referred to as the "conference report"), which is available as a
      "Featured Item" on the Web site of the Senate Committee on Energy and
      Natural Resources as a 2.6-MB PDF file. The Web site also features an
      8-page summary by fuel and a 17-page summary by title. See the
      <http://energy.senate.gov/public/>Senate Committee Web site.

      Net Metering, Tax Credits for Solar Energy Included in Energy Act

      When President Bush signed the Energy Policy Act of 2005 into law on
      Monday, he set the stage for the first federal tax credits for solar energy
      systems on homes in 20 years. According to the Solar Energy Industries
      Association (SEIA), homeowners and businesses will receive a credit of up
      to 30 percent of the cost of installing a solar power system or a solar hot
      water system. The solar energy tax credit is capped at $2,000 for each type
      of system, and applies to the cost after accounting for any state and
      utility incentives. It applies to systems that are placed in service in
      2006 or 2007. Homeowners will also earn a tax credit for installing fuel
      cells, and businesses will earn a tax credit for installing either fuel
      cells or microturbines. See the <http://www.seia.org/getpdf.php?iid=21>SEIA
      summary of the solar tax credits and see pages 1373 to 1390 of the energy
      act (<http://energy.senate.gov/public/_files/ConferenceReport0.pdf>PDF 2.6
      MB). <http://www.adobe.com/products/acrobat/alternate.html>Download Adobe

      To further encourage homeowners and businesses to generate their own power,
      the energy act amends the Public Utilities Regulatory Policies Act (PURPA)
      to require every public utility to offer interconnection to the power grid
      and net metering upon request. Net metering allows consumers to offset
      their electricity use with any self-generated electricity fed into the
      power grid over the course of a billing period. See pages 1146 to 1151 and
      pages 1173 to 1176 of the energy act
      (<http://energy.senate.gov/public/_files/ConferenceReport0.pdf>PDF 2.6 MB).

      Power Production from Renewable Energy Aided by Energy Act

      The Energy Policy Act of 2005 includes a number of provisions to increase
      the use of renewable energy as a source of electricity. The energy act
      extends the production tax credit through 2007 for electricity produced
      from wind power, geothermal power, biomass, landfill gas, small irrigation
      power, and trash combustion facilities. The credit would have expired at
      the end of this year. The act also extends the credit to include the
      hydropower generated from new facilities added to existing dams or
      conduits, and the additional hydropower generated because of efficiency
      improvements at existing hydropower stations. The American Wind Energy
      Association (AWEA) and the National Hydropower Association (NHA) hailed the
      credit extension. See the
      press release, the NHA fact sheet
      (<http://www.hydro.org/pdf/Fact_Sheet_onHR6ConfReport.pdf>PDF 31 KB), and
      pages 1222 to 1227 of the energy act
      (<http://energy.senate.gov/public/_files/ConferenceReport0.pdf>PDF 2.6 MB).
      <http://www.adobe.com/products/acrobat/alternate.html>Download Adobe Reader.

      By 2013, the act requires the federal government to buy at least 7.5
      percent of its electricity from renewable energy sources, including wind,
      solar, biomass, landfill gas, ocean, geothermal, municipal solid waste, and
      new hydroelectric generation achieved through efficiency improvements or
      capacity additions at existing hydroelectric plants. The act doubles the
      credit for power generated on-site or on federal or tribal lands.

      The act updates the Geothermal Steam Act to require competitive lease sales
      at least every two years in states with geothermal resources. Land tracts
      offered for competitive leases but not bid upon can then be offered for
      non-competitive leases. Fees will be charged based on power production, and
      only nominal fees will be charged for geothermal resources not used to
      generate power. The act also reforms the hydropower licensing process. To
      help assess the availability of renewable energy, the energy act also
      requires an annual assessment of all renewable energy resources, including
      solar, wind, biomass, ocean, geothermal, and hydroelectric energy sources.
      See pages 161 to 251 of the energy act
      (<http://energy.senate.gov/public/_files/ConferenceReport0.pdf>PDF 2.6 MB).

      Biofuel Requirement and Tax Incentives Included in Energy Act


      A photo of a fuel pump labeled 'E-85 Ethanol.'

      The new Renewable Fuels Standard will increase the use of ethanol in the
      United States.
      Credit: Warren Gretz

      The Energy Policy Act of 2005 sets a new national minimum requirement for
      the use of biofuels, particularly ethanol. The new "Renewable Fuels
      Standard" requires that gasoline sold in the United States contain a total
      of 4 billion gallons of biofuels in 2006, increasing to 7.5 billion gallons
      in 2012. The standard provides greater flexibility for refiners by allowing
      renewable fuel credits and by eliminating the reformulated gasoline
      oxygenate standard. The bill allows a credit of 2.5 gallons for every
      gallon of ethanol produced from wastes or cellulosic (woody) biomass
      sources. A recent report by DOE's Energy Information Administration
      analyzed a similar requirement and found it had a negligible impact on fuel
      prices. See the

      And should you install a refueling station for alternative fuels at your
      home or business, you can earn a 30 percent tax credit (this sounds
      unlikely for the home, but Honda is now offering home natural gas fueling
      stations in California). The credit applies to fueling stations for
      ethanol, natural gas, compressed natural gas, liquefied petroleum gas,
      hydrogen, and biodiesel blends containing at least 20 percent biodiesel.
      The act also extended tax incentives for fuel distributors that blend
      biodiesel into their diesel fuel. See the press releases from the
      <http://www.ethanolrfa.org/pr050808.html>Renewable Fuels Association and
      the National Biodiesel Board
      22 KB). <http://www.adobe.com/products/acrobat/alternate.html>Download
      Adobe Reader.

      The act also requires federal alternative fuel fleets with flexible fuel
      vehicles (vehicles that can be fueled with gasoline or alternative fuels)
      to actually use alternative fuels, provided they are reasonably available
      and not unreasonably expensive. Currently, many federal fleets are buying
      the flexible fuel vehicles but fueling them only with gasoline or diesel
      fuel. See pages 682 to 1724 of the energy act
      (<http://energy.senate.gov/public/_files/ConferenceReport0.pdf>PDF 2.6 MB).

      Energy Act to Increase Energy Efficiency in Federal Buildings

      The Energy Policy Act of 2005 will require reduced energy use in federal
      buildings, federal purchasing of energy efficient products, and more
      sustainable designs for new federal buildings. And for the first time, the
      act requires congressional office buildings to meet the same efficiency
      standards as the rest of the federal government.

      The energy act requires federal agencies to cut the energy consumption in
      their buildings to 20 percent below their energy use in 2003, in terms of
      energy use per square foot, by 2015. The act allows some exceptions for
      energy-intensive processes and matters of national security. The act also
      allows federal agencies to retain the funds not spent because of energy
      savings, but requires the agencies to invest the funds back into energy
      efficiency or renewable energy projects. To help agencies pay for energy
      improvements, the act extends the Energy Savings Performance Contracts
      program, which allows private companies to pay for the improvements and to
      be paid back with a portion of the energy savings. The act also requires
      federal agencies to buy either Energy Star products or products designated
      as energy efficient by the Federal Energy Management Program.

      New federal buildings will be designed to use 30 percent less energy than a
      building that meets the minimum standards of the International Energy
      Conservation Code (for homes) or the relevant 2004 standard from the
      American Society of Heating, Refrigeration, and Air-Conditioning Engineers.
      New federal buildings will also have to incorporate water conservation
      technologies and meet sustainable design principles. See pages 22 to 40 of
      the energy act
      (<http://energy.senate.gov/public/_files/ConferenceReport0.pdf>PDF 2.6 MB).
      <http://www.adobe.com/products/acrobat/alternate.html>Download Adobe Reader.

      Energy Act Shifts Daylight Saving Time, Sets Appliance Standards

      Here's one way to save energy: turn your lights on one hour later for a few
      weeks in the spring and fall. You might be picturing millions of frugal
      U.S. residents sitting in the dark, but Congress found an easier way to
      make that happen: extend Daylight Saving Time. Yes, thanks to the Energy
      Policy Act of 2005, in 2007 Daylight Saving Time will start on the second
      Sunday in March instead of the first Sunday in April, and will end on the
      first Sunday in November instead of the last Sunday of October. Congress
      expects the change to save energy; DOE will have to study the impact of the
      change and report back to Congress, which reserves the right to change
      things back.

      Another way to help consumers save energy is to set minimum energy
      efficiency standards for appliances and other products. The new energy act
      sets energy efficiency standards for a number of products, including
      dehumidifiers, distribution transformers, ceiling fans, traffic signals,
      illuminated exit signs, torchieres, and other products, and requires DOE to
      set new standards for battery chargers, vending machines, and external
      power supplies. The act also requires new standards for a variety of
      equipment for commercial use, including clothes washers, icemakers,
      refrigerators, freezers, and packaged air conditioning and heating
      equipment. California and five other states have already set standards for
      many of these products; a federal standard will avoid the confusion of
      having different product standards across the country on a state-by-state

      The Daylight Saving Time measure is located on pages 52 and 53 of the
      energy act, and the product standards run from page 79 to page 147. See the
      full text of the act
      (<http://energy.senate.gov/public/_files/ConferenceReport0.pdf>PDF 2.6 MB).
      <http://www.adobe.com/products/acrobat/alternate.html>Download Adobe Reader.

      Energy Connections

      EIA: High Crude Oil Prices Push Other Fuel Costs Higher

      Crude oil prices averaged $59 per barrel in July, and DOE's Energy
      Information Administration (EIA) now expects oil prices to average more
      than $59 per barrel for the entire third quarter. The EIA's "Short-Term
      Energy Outlook," released yesterday, anticipates oil prices exceeding $56
      per barrel for the remainder of 2005 and throughout 2006, as worldwide
      spare production capacity is at its lowest level in three decades. The EIA
      expects motor fuel prices to stay well above $2 per gallon through 2006.
      With heating oil prices going up, the EIA projects heating oil prices to be
      16 percent higher this winter. Natural gas prices are also rising. The EIA
      expects spot prices for natural gas to average $8.50 per million cubic feet
      (mcf) in the fourth quarter, up from $7.86 per mcf in July, but prices are
      expected to moderate in 2006, averaging $7.34 per mcf. See the EIA's
      "<http://www.eia.doe.gov/emeu/steo/pub/contents.html>Short-Term Energy

      In recent days, oil prices have been at record highs, near $64 per barrel.
      As of yesterday, fuel prices hit record highs as well. According to the
      American Automobile Association (AAA), regular unleaded gasoline averaged
      $2.354 per gallon on Tuesday, and diesel fuel averaged $2.466. (The EIA
      report put gasoline prices higher, at an average of $2.37 on Monday.) See
      the latest prices for light, sweet crude oil on the
      <http://www.nymex.com/lsco_fut_cso.aspx>New York Mercantile Exchange Web
      site, and for fuel prices, see the AAA's
      <http://www.fuelgaugereport.com/>Fuel Gage Report.

      This newsletter is funded by DOE's <http://www.eere.energy.gov/>Office of
      Energy Efficiency and Renewable Energy (EERE) and is also available on the
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