NEMA is very active on Capitol Hill, primarily in the energy, efficiency Standards, tax, and infrastructure/grid modernization areas.
Most recently, U.S. Senators Rob Portman (R-OH) and Jeanne Shaheen (D-NH) introduced the Energy Savings and Industrial Competitiveness Act of 2019. This significant piece of legislation contains many provisions of interest to the electro-industry. The bill has been considered in various forms in previous Congresses, but NEMA is optimistic that we can get the bill over the finish line this year. NEMA lobbyists participated in negotiating sessions leading up to the bill's introduction and we are staying in close contact with allies on Capitol Hill to move ahead.
"American homes, buildings, and industrial facilities are electrifying, and doing so efficiently. Using energy wisely allows our economy to produce more value at a lower cost with fewer emissions. The National Electrical Manufacturers Association (NEMA) applauds Senators Portman and Shaheen for their leadership in introducing the Energy Savings and Industrial Competitiveness Act of 2019," said NEMA President and CEO Kevin Cosgriff. "The 21st-century future will be digital, connected, and electric, as the two sponsors wisely surmise. This bill will promote important energy programs and activities to ensure that U.S. buildings and infrastructure are safe, reliable and efficient in this modernized future."
The association's top two priorities can be found in Title II of the legislation. The first provision is the extended product rebate program, to incentivize industrial facilities to upgrade their systems to include new motors and controls, helping the customer reduce its energy use by up to 50 percent per application. In addition, the provision allows the Department of Energy to collect information on the projects, so that it can create a list of best practices and case studies to share with the public.
The second NEMA priority is the transformer rebate program, which authorizes a two-year, performance-based pilot program to demonstrate that replacing old transformers with new efficient transformers makes good financial sense for electric utilities and business owners. There are over 40 million distribution transformers in service today, and some of them are 30, 40, or even 50 years old. New energy-efficient transformers are 98–99 percent efficient, so replacing and decommissioning old inefficient transformers before the end of their useful life with new efficient transformers has the potential to significantly reduce energy waste on the electric grid, in buildings, and in industrial facilities.
Additional provisions contained in the bill that NEMA supports would:
Strengthen national model building codes to make new homes and commercial buildings more energy-efficient while working with states and private industry to make the code-writing process more transparent.
Create a new grant program to assist home builders, trades, and contractors to cost-effectively implement updated building energy codes.
Train the next generation of workers in energy-efficient commercial building design and operation through university-based Building Training and Research Assessment Centers.
Streamline available federal energy efficiency programs and financing to help improve efficiency and lower energy costs for our nation's schools.
Expand the DOE Industrial Assessment Centers to include community colleges and trade schools, and creates an internship and apprenticeship program within the IAC initiative.
Allow federal agencies to use existing funds to update plans for new federal buildings, using the most current building efficiency Standards.
Establish long-term energy and water efficiency goals for the federal government, which will help save taxpayers millions of dollars.
The federal government regulates the efficiency of many products through the Energy Policy and Conservation Act. This law has been on the books for decades and sets out what products are covered, what efficiency Standards levels are, what the test procedures will be, and other factors. The law also preempts states from setting Standards for products covered by the federal program. NEMA is actively engaged in the debate over how to reform this law since many covered products have reached or are reaching the maximum possible efficiency.
NEMA has been actively lobbying against an amendment to the House Energy and Water Appropriations bill for FY2021 affecting General Service Lamps. In February 2019, DOE proposed to align its definitions of general service incandescent lamp and general service lamp with those established in EPCA. However, Rep. Kathy Castor (D-FL) added an amendment to the DOE funding bill to prohibit DOE funds from being used to finalize the definitions rule. Since appropriations work in the Senate is only just now beginning, NEMA has held several meetings to keep the Castor amendment from being added to the Senate version of the bill.
On March 26, 2019, NEMA wrote to the House Ways and Means Committee expressing support for a multi-year extension of four tax incentives that collectively promote the United States as a global leader in modern electricity technologies and that create and sustain well-paying American jobs.
- Alternative Fuel Vehicle Refueling Property Credit (§30C): We urge a multi-year extension of the §30C credit to provide a forward-looking incentive to install the charging infrastructure necessary to enable adoption of next-generation vehicles.
- Plug-In Electric Drive Vehicle Credit (§30D): We urge a multi-year extension of the 2-wheeled credit and a lifting of the 200,000 vehicle cap of the §30D credit to ensure America's continued leadership and dominance in the global EV industry.
- Energy-Efficient Commercial Buildings Deduction (§179D): We urge a multi-year extension of the §179D deduction, which has provided outsized economic benefits in the form of leveraging private investments in energy-efficient buildings and thousands of well-paying jobs that cannot be outsourced.
- Investment Tax Credit for Energy Storage: We urge you to fix the investment tax credit (ITC) in §48 and §25 regarding energy storage as an eligible technology. There is bipartisan, bicameral support for an ITC fix, which would ensure a level playing field for energy storage to compete with other resources eligible for the credit.
NEMA is also part of a coalition working to correct a drafting error in the tax reform law pertaining to the depreciation of qualified improvement property (QIP). The drafting error means taxpayers are not able to take advantage of a favorable depreciation system for these property improvements. There is no dispute that Congress intended to allow this since the Joint Explanatory Statement accompanying the tax reform law affirmed as much and the bill was scored as if the favorable treatment were to be made. Further, these QIP drafting errors are among the few provisions in H.R. 1 identified by the Joint Committee on Taxation as needing true "technical corrections." A technical corrections bill is under development in both the House and Senate.
NEMA has been enthusiastically supporting efforts in Congress to pass legislation to invest in broad infrastructure programs. Most recently, the Senate Environment and Public Works Committee unanimously passed a surface transportation bill that contains many provisions of interest to NEMA.
Action will now move to the Senate Finance Committee and Commerce Committee for their adjustment to the bill and for funding decisions. NEMA expects the House Transportation and Infrastructure Committee to release a bill later in fall 2019.
Regarding grid modernization, NEMA wrote to the House Science, Space, and Technology Committee providing input on their hearing titled, "The Future of Electricity Delivery: Modernizing and Securing our Nation's Electricity Grid." The letter commended the committee for its efforts to modernize and secure the nation's grid but urged the establishment of grant programs that help the industry develop necessary national industry consensus Standards. Furthermore, we stated that any programs should include strong partnerships with manufacturers, Standards Development Organizations, and research institutions, such as has been used with the DOE solid-state lighting program. Finally, our letter opposed efforts to emphasize outdated analog methodologies and technologies as a way of increasing grid security.