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July APGA Washington Update

Posted By IAMU, Tuesday, August 4, 2015

 

provided by the American Public Gas Association (APGA)

On July 22, the House Energy and Commerce Committee’s Subcommittee on Energy and Power held and completed a mark-up of comprehensive energy legislation.  Majority staff worked towards developing legislation that could receive bipartisan support and as a result, many controversial issues were excluded from the base text.

Unfortunately, one of those controversial items was repeal of Section 433 of the Energy Independence and Security Act of 2007, which mandates the elimination of all fossil fuel-generated energy in federal buildings by the year 2030.  APGA has been working for the repeal of this provision for some time and we are now working on an amendment strategy towards getting repeal in the bill during the committee mark-up. 

One item of significant note in the bill that APGA has been working on is the successful inclusion of language in Title IV of the bill addressing the Department of Energy’s (DOE) Notice of Proposed Rulemaking (NOPR) on natural gas furnace efficiency standards.  The NOPR DOE released in March proposed a new nationwide standard of 92 percent annual fuel utilization efficiency (AFUE) for natural gas furnaces.  The end result of this NOPR is a ban on the sale of non-condensing furnaces in the United States since condensing furnaces are the only ones capable of meeting the higher efficiency standard.  This language would not allow DOE to publish a final rulemaking until July 2016 in an effort to give stakeholders time to negotiate a compromise that can be presented to DOE.  If the stakeholders can come to an agreement with the advocates, it would require DOE to publish a second Supplemental Notice of Proposed Rulemaking (SNOPR) seeking comments on the stakeholders’ agreement.  The language would also require DOE to publish a SNOPR requesting comments on developing separate product classes based on furnace size. 

Discussions on the draft will continue over the next few weeks and into the August recess with a full Committee mark-up to occur in September. 

Also on July 22, the Senate Committee on Finance passed a package of tax credits known as Tax Extenders that includes a wide variety of tax incentives for businesses and energy companies.  Tax Extenders legislation includes two key pro-natural gas vehicles (NGV) credits, including:

  1. An alternative fuel vehicle refueling property credit, also known as Alternative Fuel Infrastructure Credit,  which covers up to 30 percent of the cost of the project capped at $30,000; and,
  2. An alternative fuel credit, which provides a 50 cent/gallon credit for sales of compressed natural gas (CNG) and liquefied natural gas (LNG) sold for use in motor vehicles.

Under the bill, both credits would be retroactive back to December 31, 2014 and would expire on December 31, 2016, a full two year extension of these essential tax credits. In addition, Senator Burr (R-N.C.) and Senator Bennet (D-Colo.) successfully passed an amendment to the bill that would correct the existing LNG Excise Tax inequity, which would effectively tax LNG at 14.1 cents per gallon of diesel.

There are two key hurdles to adoption of the Tax Extenders bill: cost and competing priorities. First, the Tax Extenders package reported out of committee will cost $95 billion, presenting an enormous challenge for Congress to find offsets to avoid adding to the deficit and debt. Second, Congress is trying to pass legislation to extend surface transportation programs before the Highway Trust Fund runs out of funding at the end of July. Similar to the Tax Extenders bill, Congress will have to find offsets for that legislation if it doesn’t want to add to the deficit/debt. It appears that the surface transportation bill is the higher priority, so the Tax Extenders bill will likely be delayed and modified before any attempted passage. APGA will keep members informed of any developments with this legislation.

Recently, APGA along with the American Gas Association (AGA) and the New Buildings Institute hosted a joint meeting on the role of natural gas in net zero energy buildings.  In addition to APGA staff, representatives from Middle Tennessee Natural Gas, the Municipal Gas Authority of Georgia, the Illinois Public Energy Agency, numerous investor-owned utilities as well as the American Institute of Architects attended the meeting.  While there are number of different definitions, a zero-energy building is generally considered to be a building with zero net energy consumption, meaning the total amount of energy used by the building on an annual basis is roughly equal to the amount of energy created on the site.  Net-zero buildings continue to receive discussion at the state and federal level.   

During the course of the one-day meeting, participates heard presentations from KB Home Builders on their net zero homes.  McDonalds discussed how they are integrating net-zero into their restaurants and there was a presentation from the U.S. Army on how they are approaching net-zero from a community perspective.  After the sessions, all of the attendees engaged in a lengthy discussion about the many challenges and opportunities LDCs face with net zero building construction.  The meeting concluded with the group outlining next steps.   As part of this process, the group identified areas that need further research, national priorities and state and local opportunities.  Moving forward, APGA has positioned itself to take the lead along with AGA to continue to guide the discussion.  APGA believes the direct-use of natural gas, such as in the case of combined heat and power (CHP), can play an important role in net-zero buildings. 

Lastly, APGA would like to invite you to attend our upcoming Gas Equipment and Application Conference (GEAC) in Atlanta September 13-15. This is the inaugural GEAC and the program features three tracks (Residential Natural Gas Applications, Commercial Natural Gas Applications, and Policy & Management Trends). The GEAC will showcase the newest natural gas end-use technologies and applications by bringing together manufacturers, distributors, utility professionals, and other end-users for informative sessions that will increase your knowledge and expertise. With an exhibitor hall featuring the latest natural gas products on the market, you will learn directly from manufacturers, discuss innovative applications, and recognize opportunities for deployment in your communities.

More information including registration and the full program is available at www.apga.org/GEAC. We hope to see you in Atlanta this September!

For questions on any of APGA’s advocacy issues, please contact Dave Schryver of APGA staff by phone at 202-464-2742 or by email at dschryver@apga.org.

Tags:  APGA 

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