1. 5th Annual Pollution Prevention and Hazardous Waste Management Conference and Exhibition: "Changing Today for a Cleaner Tomorrow— Environmental Quality 2000" August 23, 2000 Executive Order 13123: Greening the Government Through Efficient Energy Management Presented by Chris Tremper McNeil Technologies, Inc. for the Department of Energy’s Federal Energy Management Program Office of Energy Efficiency and Renewable Energy

2. Evolution of Federal Energy Management Policy National Security - Reduction of petroleum-based fuels (dependence on foreign sources) Fiscal Imperative - Life Cycle Cost Effectiveness - Government Productivity Economic Stimulation - Encouraging emerging EE/RE technologies - Business opportunities for energy service companies Environmental Stewardship

3. Legislative History/Executive Directives Energy Policy and Conservation Act (1975) DOE Organization Act (1977) National Energy Conservation Policy Act (1978) Federal Energy Management Improvement Act (1988) Executive Order 12759 (1991) Energy Policy Act (1992) Executive Order 12902 (1994) Executive Order 13123 (1999)

4. Paving the Way for Additional Success Builds on and replaces E.O. 12902 White House leadership Significant agency involvement Takes into account lessons learned over past few years Emphasizes taxpayer savings while promoting sound environmental decisions Reinforces Government’s role in leading the nation

5. Benefits of E.O. 13123 Activities Saves taxpayers $750 million annually Stimulates private sector investments, generates profits, and creates new jobs Renews Federal infrastructure Seizes opportunities from utility restructuring Cuts greenhouse gas emissions by 2.3 million tons annually from current levels; improves air quality Demonstrates Federal leadership, recognizes and encourages agency energy champions

6. Executive Order Emphasis

7. E.O. 13123 Goals Reduce Greenhouse Gas Emissions - Emissions from facility energy use to be reduced 30 - percent by 2010 compared to 1990. Reduce Energy Consumption - Facility energy per square foot to be reduced by 30 - - percent in 2005 and 35 percent in 2010 relative to 1985. - Industrial/Laboratory energy to be reduced by 20 - percent in 2005 and 25 percent in 2010 relative to 1990. Expand Use of Renewable Energy Reduce Petroleum-Based Fuel Use in Facilities Reduce Total Energy Use as Measured at the Source Establish and Reach Water Conservation Goals

8. Buildings Goal 35% reduction in energy intensity in buildings by 2010 compared to 1985 National Energy Conservation Policy Act, as amended in 1988 - 10% goal for FY1995 Energy Policy Act of 1992 - 20% goal for FY2000 Executive Order 12902 of 1994 - 30% goal for FY2005 Executive Order 13123 - 35% goal for FY2010

9. Building Energy Reduction Goals

10. Progress Toward Buildings Goals Progress Toward 35% Reduction Goal for Buildings (Preliminary Data) FY 1999 Btu/Square Foot Reduction

11. Agency Buildings Energy Consumption Agency FY99 Progress (Preliminary Data) Federal Buildings Energy Costs $3.04 Billion

12. Industrial/Laboratory Goals 25% improvement in industrial/laboratory facilities by 2010 compared to 1990 base year - builds on existing 20% goal for 2005 E.O.-required Guidelines: Performance Goals for Industrial, Laboratory, Research, and Other Energy- Intensive Facilities - Measuring Performance Toward the Goals: 3 Options - Developing Appropriate Baselines EPA/DOE Laboratories for the 21st Century Initiative www.epa.gov/labs21century www.epa.gov/labs21century

13. Laboratory Successes EPA’s National Vehicle and Fuel Emissions Laboratory in Ann Arbor, MI awarded an energy savings performance contract to NORESCO Installed all new HVAC equipment that recirculates air in lieu of using 100 percent outside air, and uses a more efficient cooling and heating process to deliver the required space conditions Benefits: - Reduce annual electric demand by 68 percent - Reduce energy use per gross square foot by 66 percent - Reduce annual water consumption by 80 percent - Reduce the annual utility bill by 74%—from $1.1 million to $268,000. - Prevent emission of almost 40,000 pounds of nitrous oxides, more than 100,000 pounds of sulphur dioxide, and almost 7,000 tons of carbon dioxide

14. Greenhouse Gas Reduction Goal 30% reduction in greenhouse gas emissions by 2010 compared to 1990 E.O.-required Guidance for Estimating Greenhouse Gas Emissions Attributable to Facility Energy Use - DOE/FEMP will estimate carbon emissions based on agency- submitted energy consumption data - Emissions from electricity consumption will be estimated on a state by state basis

15. Progress Toward Greenhouse Gas Goal 15% reduction in greenhouse gas emissions from Federal facility energy consumption in 1999 compared to 1990

16. Renewable Energy Goal E.O.-required Guidance on Federal Government Renewable Energy Goal - 2.5% of Federal facility electricity consumption by 2005 1,335 GWh -- equivalent to 500 MW wind power plant 173 GWh already in place Reporting Renewable Energy - New renewable energy only -- installed since 1990 - Green power or RE fuel purchases included in annual reporting - Renewable project reporting optional -- data submission to FEMP - Renewable energy treated the same as energy efficiency projects in terms of satisfying energy conservation goals not added to overall energy consumption Qualifying projects: - RE outside of facilities and electricity solar thermal, passive solar, off-grid wind and solar, renewable energy transportation fuels - Million Solar Roofs projects - Can include RE projects an agency facilitates -- projects sited on Federal lands, used by agency clients - Renewable energy portion of green power or fuel purchases Does not include: - hydropower -- excluded in Executive Order - Excludes renewable energy generation by energy service providers unless agency specifically contracts for it

17. Water Conservation Goal E.O.-required Guidance to Establish Water Efficiency Improvement Goal for Federal Agencies Reduce potable water usage by implementing cost-effective water efficiency programs in facilities, that include: - Water management plan - Four separate FEMP water efficiency improvement Best Management Practices (BMPs). Schedule for implementation: - 5% of facilities by 2002 - 15% of facilities by 2004 - 30% of facilities by 2006 - 50% of facilities by 2008 - 80% of facilities by 2010

18. How Do We Meet Goals?

19. Management Accountability/Implementation Agencies must: - Designate a Senior Official - Form a Technical Support Team - Develop Annual Implementation Plan - Annual Report to the President use of strategies progress toward goals exempt facilities Agency Score Cards President’s Management Council Public/Private Advisory Committee White House Workshop

20. Personnel Development/Training Employee Incentive Programs Include Energy Management in Performance Plans Training and Education Presidential Award Federal Energy and Water Management Awards Program Energy Champions... part of You Have the Power Campaign

21. Budget & Funding/Alternative Financing Annual Budget Submission - Each agency's budget submission to OMB shall specifically request funding necessary to achieve the goals of this order Maximize Use of Alternative Financing Contracting Mechanisms - Energy Savings Performance Contracts - Utility Energy Service Contracts

22. Energy Savings Performance Contracts ESPCs reallocate the Government’s utility bill - Pay a lower utility bill - Pay the contractor - Achieve cost savings for the Government Benefits of ESPCs: - Sites reduce their energy use/$ - Improves the environment - Saves taxpayer dollars - Stimulates growth and research in the energy efficiency industry and generates local job growth - Non-energy related capital improvements through bundling

23. Types of ESPC Contracts

24. ESPC Success at DOD Installations Fort Lewis, Washington - Resource Efficiency Manager Program Established in 1997 - Reducing Costs for Energy, Water, and Wastewater - 16 Percent reduction in energy use - Amount of Energy Saved = Total Annual Energy Use of 1,835 Homes in Washington State Fort Polk, Louisiana - Retrofit family housing complex - 4000 geothermal heating and cooling systems - $18 million in private investment through Army Corps of Engineers ESPC - $102 million in savings over 20 years - 38 percent reduction in energy use Military District of Washington - Retrofit over 800 buildings - $70 million investment through DESC ESPC - $219 million savings over 18 years - 17 percent reduction in energy use Hill AFB, Utah - Energy Service Contract for Sulfur Lamps - Reduced energy and lighting costs, increased quality & quantity of light for 700 aircraft maintenance workers in five hangars

25. Utility Energy Savings Contracts Since 1994, projects valued in excess of $350 million completed - Awarded and completed projects: 310 - Total project investment: $379 million - Estimated Annual Cost Savings: $54 million Over $100 million in projects in progress - Total awarded, completed, and proposed projects: 413 - Potential investment from awarded, completed, and proposed projects: $543 million - Potential estimated annual cost savings: $70 million Edison Electric Institute Commitment - $2.0 billion in life-cycle cost-effective facility improvement projects to achieve energy efficiency and renewable energy goals

26. Utility Contract Success Story Complete overhaul of 30-year-old building's energy and water systems Annual energy savings is $640,000 Measures were taken at Chet Holifield: - Installing a thermal energy storage system - Rebalancing air distribution system - Replacing fan motors - Installing variable-frequency drives on hot water pumps - Upgrading the energy management control system. Southern California Edison (SCE) financed the entire capital cost ($3.8 million), which will be repaid from the energy savings Chet Holifield Federal Building Laguna Niguel, California

27. Electricity Purchases/Renewables Take advantage of Competitive Power Opportunities Purchase Electricity from sources that are Less Greenhouse-Gas-Intensive Increase Purchase of Electricity from Renewable Energy Sources

28. Green Power Purchases EPA’s Region 9 Laboratory in Richmond, CA, 100% green power - Sacramento Municipal Utility District (SMUD) 30 Federal agencies commit to purchase 25 million kWh/year from Public Service Company of Colorado’s Wind source program - U.S. Air Force Academy - Fort Carson - Defense Contract Management Agency

29. On-Site Generation/Renewables Implement Highly Efficient Systems - Combined heat & power/district energy systems - Biomass, geothermal Take Advantage of Off-Grid Generation Opportunities - Solar outdoor lighting - Fuel cells - Small wind turbines

30. Distributed Power Technologies Wind Photovoltaics Reciprocating Engine Fuel Cells MicroTurbines Biomass

31. Photovoltaics - The Pentagon 30 KW Project Dedicated June 28, 1999 Test advanced technology Educate public

32. Solar Water Heating Pearl Harbor, HI U.S. Navy housing Moanalua Terrace Solar water heating planned for over 750 homes Savings of over $2,000 per home

33. Wind Power San Clemente Island Naval Station Three wind turbines operational July 2, 1999 $346,000 Projected annual savings vs. diesel fuel Long range plan for 100% renewable power supply

34. Energy Star/Energy-Efficient Product Procurement Life-Cycle Cost Analysis Purchase Products in the Upper 25% of Energy Efficiency - Energy Star and other efficient products - Incorporate product criteria consistent with Energy Star and other energy efficiency levels into guide and project specifications

35. Energy Star Building Success U.S. Custom House in Philadelphia (GSA) - one of first historic buildings in program Energy efficiency retrofits: - T-8 lamps and electronic ballasts - high efficiency chillers and motors - resealing of windows - high efficiency dual fuel boilers, - computerized energy management system 14% energy reduction $390,000 in annual savings

36. Assistance for Agencies Super Energy Savings Performance Contracts - Expedited, pre-competed contracts - General as well as technology- specific contracts GSA Area-Wide Utility Contracts - Another tool for efficiency and renewable projects Energy Efficient Procurement/ ENERGY STAR - GSA and Defense Logistics Agency schedules highlight these products Design Assistance for New Construction Renewable Technologies - Design assistance - Training - Limited grants Training SAVEnergy Audits

37. Sources for More Information FEMP Web Site: www.eren.doe.gov/fempwww.eren.doe.gov/femp FEMP Help Desk: 800-363-3732 FEMP Focus Newsletter FEMP HQ Office: 202-586-5772 DOE Regional Office FEMP Team DOE National Laboratory Liaisons "Energy 2000" - FEMP Annual Conference - August 21-23 - Next year: Kansas City in June

38. Energy Star/Whole Building Energy Efficiency Incorporate Energy and Water Efficiency in Lease Provisions Meet Energy Star Building Criteria Design and Construct Sustainable New Buildings - Whole Building Design Guide (http://www.wbdg.org)http://www.wbdg.org Showcase Facilities