After mandating that cars get 54.5 miles per gallon by 2025, Barack Obama has signed an executive order in which he will now be “accelerating investment in industrial energy efficiency.” This new measure is determined to help manufacturers expand their use of combined heat and power (CHP) facilities, which then generate thermal and generating power in one process.
According to the EO, the new policy reads:
The industrial sector accounts for over 30 percent of all energy consumed in the United States, and, for many manufacturers, energy costs affect overall competitiveness. While our manufacturing facilities have made progress in becoming more energy efficient over the past several decades, there is an opportunity to accelerate and expand these efforts with investments to reduce energy use through more efficient manufacturing processes and facilities and the expanded use of combined heat and power (CHP). Instead of burning fuel in an on site boiler to produce thermal energy and also purchasing electricity from the grid, a manufacturing facility can use a CHP system to provide both types of energy in one energy efficient step. Accelerating these investments in our Nation’s factories can improve the competitiveness of United States manufacturing, lower energy costs, free up future capital for businesses to invest, reduce air pollution, and create jobs.
Despite these benefits, independent studies have pointed to under-investment in industrial energy efficiency and CHP as a result of numerous barriers. The Federal Government has limited but important authorities to overcome these barriers, and our efforts to support investment in industrial energy efficiency and CHP should involve coordinated engagement with a broad set of stakeholders, including States, manufacturers, utilities, and others. By working with all stakeholders to address these barriers, we have an opportunity to save industrial users tens of billions of dollars in energy costs over the next decade.
There is no one size fits all solution for our manufacturers, so it is imperative that we support these investments through a variety of approaches, including encouraging private sector investment by setting goals and highlighting the benefits of investment, improving coordination at the Federal level, partnering with and supporting States, and identifying investment models beneficial to the multiple stakeholders involved.
To formalize and support the close interagency coordination that is required to accelerate greater investment in industrial energy efficiency and CHP, this order directs certain executive departments and agencies to convene national and regional stakeholders to identify, develop, and encourage the adoption of investment models and State best practice policies for industrial energy efficiency and CHP; provide technical assistance to States and manufacturers to encourage investment in industrial energy efficiency and CHP; provide public information on the benefits of investment in industrial energy efficiency and CHP; and use existing Federal authorities, programs, and policies to support investment in industrial energy efficiency and CHP.
The addition of the new capacity would save energy users $10 billion a year compared to their existing energy sources and would also result in $40-80 billion in new capital investment in manufacturing.
The order directs the Departments of Energy, Commerce, and Agriculture, and the Environmental Protection Agency, in coordination with a number of White House advisory groups, to coordinate their policies to encourage investment in industrial efficiency.
The order also directs the federal agencies to help states to use CHP to achieve their national ambient air quality standards, and provide incentives through their regulations to help boost the technology.
The White House says that these increased investments, or we should call them what they really are, tax dollars, would improve the industrial sector’s competitiveness and lower energy costs and reduce emissions. However, we all recall that Barack Obama told us exactly what his energy plan would do, and it had nothing to do with reducing costs.
How will this new EO be carried out? According to the order:
(a) coordinate and strongly encourage efforts to achieve a national goal of deploying 40 gigawatts of new, cost effective industrial CHP in the United States by the end of 2020;
(b) convene stakeholders, through a series of public workshops, to develop and encourage the use of best practice State policies and investment models that address the multiple barriers to investment in industrial energy efficiency and CHP;
(c) utilize their respective relevant authorities and resources to encourage investment in industrial energy efficiency and CHP.
(d) support and encourage efforts to accelerate investment in industrial energy efficiency and CHP
More regulations means higher prices, not lower ones. Barack Obama either purposefully knows this or is completely ignorant of economics. I think he knows exactly what he’s doing here and though he claims it will save energy consumers all this money, he told us in the beginning exactly what his policies would do to consumers’ energy prices…..they would skyrocket.
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