2208 112th CONGRESS
H. R. 2208
To incorporate smart grid capability into the
Energy Star Program, to reduce peak electric demand, to reauthorize a energy efficiency
public information program to include Smart Grid information, and for other purposes.IN
THE HOUSE OF REPRESENTATIVES
June 16, 2011
MCNERNEY introduced the following bill; which was referred to the Committee on
Energy and Commerce
smart grid capability into the Energy Star Program, to reduce peak electric demand,
to reauthorize a energy efficiency public information program to include Smart
Grid information, and for other purposes.
Be it enacted
by the Senate and House of Representatives of the United States of America in
SECTION 1. SHORT TITLE.
This Act may be cited as the `Smart Grid Advancement Act of 2011'.
The term `Administrator' means the Administrator of the Environmental Protection
(2) APPLICABLE BASELINE- The term `applicable
baseline' means the average of the highest three annual peak demands a load-serving
entity has experienced during the 5 years immediately prior to the date of enactment
of this Act.
(3) COMMISSION- The term `Commission' means
the Federal Energy Regulatory Commission.
ENTITY- The term `load-serving entity' means an entity that provides electricity
directly to retail consumers with the responsibility to assure power quality and
reliability, including such entities that are investor-owned, publicly owned,
owned by rural electric cooperatives, or other entities.
(5) PEAK DEMAND- The term `peak demand' means the highest point of electricity
demand, net of any distributed electricity generation or storage from sources
on the load-serving entity's customers' premises, during any hour on the system
of a load-serving entity during a calendar year, expressed in megawatts (MW),
or more than one such high point as a function of seasonal demand changes.
(6) PEAK DEMAND REDUCTION- The term `peak demand reduction' means the reduction
in annual peak demand as compared to a previous baseline year or period, expressed
in megawatts (MW), whether accomplished by--
diminishing the end-use requirements for electricity;
(B) use of locally stored energy or generated electricity to meet those requirements
from distributed resources on the load-serving entity's customers' premises and
without use of high-voltage transmission; or
(C) energy savings from efficient operation of the distribution grid resulting
from the use of a Smart Grid.
(7) PEAK DEMAND REDUCTION
PLAN- The term `peak demand reduction plan' means a plan developed by or for a
load-serving entity that it will implement to meet its peak demand reduction goals.
(8) PEAK PERIOD- The term `peak period' means the time period on the system of
a load-serving entity relative to peak demand that may warrant special measures
or electricity resources to maintain system reliability while meeting peak demand.
(9) SECRETARY- The term `Secretary' means the Secretary of Energy.
(10) SMART GRID- The term `Smart Grid' has the meaning provided by section 1301
of the Energy Independence and Security Act of 2007 (42 U.S.C. 17381).
3. ASSESSMENT OF SMART GRID COST EFFECTIVENESS IN PRODUCTS.
Assessment- Not later than 1 year after the date of enactment of this Act, the
Secretary and the Administrator shall each assess the potential for cost-effective
integration of Smart Grid technologies and capabilities in all products that are
reviewed by the Department of Energy and the Environmental Protection Agency,
respectively, for potential designation as Energy Star products.
(b) Analysis- (1) Not later than 2 years after the date of enactment of this Act,
the Secretary and the Administrator shall each prepare an analysis of the potential
energy savings, greenhouse gas emission reductions, and electricity cost savings
that could accrue for each of the products identified by the assessment in subsection
(a) in the following optimal circumstances:
(A) The products
possessed Smart Grid capability and interoperability that is tested and proven
(B) The products were utilized in an electricity
utility service area which had Smart Grid capability and offered customers rate
or program incentives to use the products.
(C) The utility's
rates reflected national average costs, including average peak and valley seasonal
and daily electricity costs.
(D) Consumers using such
products took full advantage of such capability.
The utility avoided incremental investments and rate increases related to such
(2) The analysis under paragraph (1) shall be considered
the `best case' Smart Grid analysis. On the basis of such an analysis for each
product, the Secretary and the Administrator shall determine whether the installation
of Smart Grid capability for such a product would be cost effective. For purposes
of this paragraph, the term `cost effective' means that the cumulative savings
from using the product under the best case Smart Grid circumstances for a period
of one-half of the product's expected useful life will be greater than the incremental
cost of the Smart Grid features included in the product.
the extent that including Smart Grid capability in any products analyzed under
paragraph (2) is found to be cost effective in the best case, the Secretary and
the Administrator shall, not later than 3 years after the date of enactment of
this Act take each of the following actions:
(A) Inform the
manufacturer of such product of such finding of cost effectiveness.
(B) Assess the potential contributions the development and use of products with
Smart Grid technologies bring to reducing peak demand and promoting grid stability.
(C) Assess the potential national energy savings and electricity cost savings
that could be realized if Smart Grid potential were installed in the relevant
products reviewed by the Energy Star program.
and identify options for providing consumers information on products with Smart
Grid capabilities, including the necessary conditions for cost-effective savings.
(E) Submit a report to Congress summarizing the results of the assessment for
each class of products, and presenting the potential energy and greenhouse gas
savings that could result if Smart Grid capability were installed and utilized
on such products.
SEC. 4. INCLUSIONS OF SMART GRID CAPABILITY
ON APPLIANCE ENERGY GUIDE LABELS.
Section 324(a)(2) of the Energy
Policy and Conservation Act (42 U.S.C. 6294(a)(2)) is amended by adding the following
at the end:
`(J)(i) Not later than 1 year after the date
of enactment of this subparagraph, the Federal Trade Commission shall initiate
a rulemaking to consider making a special note in a prominent manner on any ENERGY
GUIDE label for any product actually including Smart Grid capability that--
`(I) Smart Grid capability is a feature of that product;
`(II) the use and value of that feature depended on the Smart Grid capability
of the utility system in which the product was installed and the active utilization
of that feature by the customer; and
`(III) on a utility system with Smart Grid capability, the use of the product's
Smart Grid capability could reduce the customer's cost of the product's annual
operation by an estimated dollar amount range representing the result of incremental
energy and electricity cost savings that would result from the customer taking
full advantage of such Smart Grid capability.
`(ii) Not later than 3 years after the date of enactment of this subparagraph,
the Commission shall complete the rulemaking initiated under clause (i).'.
5. SMART GRID PEAK DEMAND REDUCTION GOALS.
(a) Goals- Not later
than 1 year after the date of enactment of this section, each load-serving entity,
or, at the option of the State, each State with respect to load-serving entities
that the State regulates, shall determine and publish peak demand reduction goals
for any load-serving entities that have an applicable baseline in excess of 250
(b) Baselines- (1) The Commission, in consultation
with the Secretary and the Administrator, shall develop and publish, after an
opportunity for public comment, but not later than 180 days after the date of
enactment of this section, a methodology to provide for adjustments or normalization
to a load-serving entity's applicable baseline over time to reflect changes in
the number of customers served, weather conditions, general economic conditions,
and any other appropriate factors external to peak demand management, as determined
by the Commission.
(2) The Commission shall support load-serving
entities (including any load-serving entities with an applicable baseline of less
than 250 megawatts that volunteer to participate) in determining their applicable
baselines and in developing their peak demand reduction goals.
(3) The Secretary, in consultation with the Commission, the Administrator, and
the North American Electric Reliability Corporation, shall develop a system and
rules for measurement and verification of demand reductions.
Peak Demand Reduction Goals- (1) Peak demand reduction goals may be established
for an individual load-serving entity, or, at the determination of a State, tribal,
or regional entity, by that State, tribal, or regional entity for a larger region
that shares a common system peak demand and for which peak demand reduction measures
would offer regional benefit.
(2) A State or regional entity establishing
peak demand reduction goals shall cooperate, as necessary and appropriate, with
the Commission, the Secretary, State regulatory commissions, State energy offices,
the North American Electric Reliability Corporation, and other relevant authorities.
(3) In determining the applicable peak demand reduction goals--
(A) States and other jurisdictional entities may utilize the results of the 2009
National Assessment of Demand Response Potential, as authorized by section 571
of the National Energy Conservation Policy Act (42 U.S.C. 8279); and
(B) the relative economics of peak demand reduction and generation required to
meet peak demand shall be evaluated in a neutral and objective manner.
(4) The applicable peak demand reduction goals shall provide that--
(A) load-serving entities will reduce or mitigate peak demand by a minimum percentage
amount from the applicable baseline to a lower peak demand during calendar year
(B) load-serving entities will reduce or mitigate
peak demand by a minimum percentage greater amount from the applicable baseline
to a lower peak demand during calendar year 2017; and
(C) the minimum percentage reductions established as peak demand reduction goals
shall be the maximum reductions that are realistically achievable with an aggressive
effort to deploy Smart Grid and peak demand reduction technologies and methods,
including those listed in subsection (d).
(d) Plan- Each
load-serving entity shall prepare a peak demand reduction plan that demonstrates
its ability to meet each applicable goal by any or a combination of the following
(1) Direct reduction in megawatts of peak demand
(A) energy efficiency measures (including
efficient transmission wire technologies which significantly reduce line loss
compared to traditional wire technology) with reliable and continued application
during peak demand periods; or
(2) Demonstration that an amount of
megawatts equal to a stated portion of the applicable goal is contractually committed
to be available for peak reduction through one or more of the following:
(A) Megawatts enrolled in demand response programs.
(B) Megawatts subject to the ability of a load-serving entity to call on demand
response programs, smart appliances, smart electricity or energy storage devices,
distributed generation resources on the entity's customers' premises, or other
measures directly capable of actively, controllably, reliably, and dynamically
reducing peak demand (`dynamic peak management control').
(C) Megawatts available from distributed dynamic electricity or energy storage
under agreement with the owner of that storage.
(D) Megawatts committed from dispatchable distributed generation demonstrated
to be reliable under peak period conditions and in compliance with air quality
(E) Megawatts available from smart
appliances and equipment with Smart Grid capability available for direct control
by the utility through agreement with the customer owning the appliances or equipment
or with a third party pursuant to such agreements.
(F) Megawatts from a demonstrated and assured minimum of distributed solar electric
generation capacity in instances where peak period and peak demand conditions
are directly related to solar radiation and accompanying heat.
(3) If any of the methods listed in subparagraph (C), (D), or (E) of paragraph
(2) are relied upon to meet its peak demand reduction goals, the load-serving
entity must demonstrate this capability by operating a test during the applicable
(4) Nothing in this section shall require
the publication in peak demand reduction goals or in any peak demand reduction
plan of any information that is confidential for competitive or other reasons
or that identifies individual customers.
(e) Existing Authority
and Requirements- Nothing in this section diminishes or supersedes any authority
of a State or political subdivision of a State to adopt or enforce any law or
regulation respecting peak demand management, demand response, distributed energy
storage, use of distributed generation, or the regulation of load-serving entities.
The Commission, in consultation with States and Indian tribes having such peak
demand management, demand response, and distributed energy storage programs, shall
to the extent practicable, facilitate coordination between the Federal program
and such State and tribal programs.
(f) Relief- The Commission
may, for good cause, grant relief to load-serving entities from the requirements
of this section.
(g) Other Laws- Except as provided in subsections
(e) and (f), no law or regulation shall relieve any person of any requirement
otherwise applicable under this section.
(h) Compliance- (1) The
Commission shall, not later than 1 year after the date of enactment of this Act,
establish a public website where the Commission shall provide information and
data demonstrating compliance by States, Indian tribes, regional entities, and
load-serving entities with this section, including the success of load-serving
entities in meeting applicable peak demand reduction goals.
The Commission shall, by April 1 of each year beginning in 2014, provide a report
to Congress on compliance with this section and success in meeting applicable
peak demand reduction goals and, as appropriate, shall make recommendations as
to how to increase peak demand reduction efforts.
(3) The Commission
shall note in each such report any State, political subdivision of a State, or
load-serving entity that has failed to comply with this section, or is not a part
of any region or group of load-serving entities serving a region that has complied
with this section.
(4) The Commission shall have and exercise
the authority to take reasonable steps to modify the process of establishing peak
demand reduction goals and to accept adjustments to them as appropriate when sought
by load-serving entities.
(i) Assistance and Funding-
(1) ASSISTANCE- The Secretary may make grants to States and to other entities
with responsibilities to be carried out under the Act to offset any documented
costs of carrying out such responsibilities to the extent such costs are deemed
burdensome or extraordinary by the Secretary.
There are authorized to be appropriated such sums as may be necessary to the Commission,
the Secretary, and the Administrator to carry out the provisions of this Act.
6. REAUTHORIZATION OF ENERGY EFFICIENCY PUBLIC INFORMATION PROGRAM TO INCLUDE
SMART GRID INFORMATION.
(a) In General- Section 134 of the Energy
Policy Act of 2005 (42 U.S.C. 15832) is amended as follows:
(1) By amending the section heading to read as follows: `energy efficiency and
smart grid public information initiative'.
(2) In paragraph
(1) of subsection (a), by striking `reduce energy consumption during the 4-year
period beginning on the date of enactment of this Act' and inserting `increase
energy efficiency and to adopt Smart Grid technology and practices'.
(3) In paragraph (2) of subsection (a), by striking `benefits to consumers of
reducing' and inserting `economic and environmental benefits to consumers and
the United States of optimizing'.
(4) In subsection (a),
by inserting at the beginning of paragraph (3) `the effect of energy efficiency
and Smart Grid capability in reducing energy and electricity prices throughout
the economy, together with'.
(5) In subsection (a)(4),
by redesignating subparagraph (D) as subparagraph (E), by striking `and' at the
end of subparagraph (C), and by inserting after subparagraph (C) the following:
`(D) purchasing and utilizing equipment that includes Smart Grid features and
(6) In subsection (c), by striking
`Not later than July 1, 2009,' and inserting, `For each year when appropriations
pursuant to the authorization in this section exceed $10,000,000,'.
(7) In subsection (d) by striking `2010' and inserting `2022'.
(8) In subsection (e) by striking `2010' and inserting `2022'.
(b) Table of Contents- The item relating to section 134 in the table of contents
for the Energy Policy Act of 2005 (42 U.S.C. 15801 and following) is amended to
read as follows:
`Sec. 134. Energy efficiency and Smart Grid
public information initiative.'.
SEC. 7. INCLUSION OF SMART
GRID FEATURES IN APPLIANCE REBATE PROGRAM.
(a) Amendments- Section
124 of the Energy Policy Act of 2005 (42 U.S.C. 15821) is amended as follows:
(1) By amending the section heading to read as follows: `energy efficient and
smart appliance rebate program.'.
(2) By redesignating
paragraphs (4) and (5) of subsection (a) as paragraphs (5) and (6), respectively,
and inserting after paragraph (3) the following:
SMART APPLIANCE- The term `smart appliance' means a product that the Administrator
of the Environmental Protection Agency or the Secretary of Energy has determined
qualifies for such a designation in the Energy Star program pursuant to section
3 of the Smart Grid Advancement Act of 2011, or that the Secretary or the Administrator
has separately determined includes the relevant Smart Grid capabilities listed
in section 1301 of the Energy Independence and Security Act of 2007 (42 U.S.C.
(3) In subsection (b)(1) by inserting `and
smart' after `efficient' and by inserting after `products' the first place it
appears `, including products designated as being smart appliances'.
(4) In subsection (b)(3), by inserting `the administration of' after `carry out'.
(5) In subsection (d), by inserting `the administration of' after `carrying out'
and by inserting `, and up to 100 percent of the value of the rebates provided
pursuant to this section' before the period at the end.
(6) In subsection (e)(3), by inserting `, with separate consideration as applicable
if the product is also a smart appliance,' after `Energy Star product' the first
place it appears and by inserting `or smart appliance' before the period at the
(7) In subsection (f), by striking `$50,000,000'
through the period at the end and inserting `$100,000,000 for each fiscal year
from 2012 through 2017.'.
(b) Table of Contents- The item
relating to section 124 in the table of contents for the Energy Policy Act of
2005 (42 U.S.C. 15801 and following) is amended to read as follows:
124. Energy efficient and smart appliance rebate program.'.