Representative John Dingell (D-MI), the powerful chairman of the House Energy and Commerce Committee, issued a "Discussion Draft" Energy Bill. The bill addresses Cap and Trade, Carbon Market oversight, Greenhouse Gas standards, Energy Efficiency in buildings, and Climate Change. The bill is over 460 pages long and if enacted will substantially change the market for energy.
CAP AND TRADE
Relevant to the Development industry, the bill contains a list of "covered entities" that may be subject to the cap and trade regime. One "covered entity" is "any electricity source". An electricity source is defined as a stationary source that includes one or more utility units. A utility unit is a fossil-fuel combustion device that produces electricity for sale (i.e., not a fuel cell). Also, the bill specifically excludes fossil fuel-fired cogeneration devices (steam and electricity) unless the unit supplies more than 1/3 of its potential electric output capacity and more than 25 MW of electric output for sale. Another "covered entity" is a stationary source that produces more than 25,000 tons of carbon dioxide. Finally, a "covered entity" includes any local distribution company (gas company) that delivers 460,000 cubic feet or more of natural gas to commercial and residential customers. Based on these definitions, actual development projects and buildings are not within the realm of a "covered entity". However, the costs of energy being supplied to consumers will be affected because every electricity source, other than most distributed generation, will fall under the Cap and Trade regime.
Energy Efficiency
The most interesting part of the proposed bill is the Energy Efficiency sections (which do not start until page 337). The bill proposes to establish a State Energy Efficiency Development (SEED) Fund. Under the Fund, the EPA would offer low-interest or zero-interest loans to increase energy efficiency in new and existing commercial building. The SEED money can be used by owners and to the tenants of portions of buildings. In order to qualify for a zero-interest loan, the building must become Energy Star designated or undergo a 30 percent reduction in energy use. Otherwise, the loan remains a low-interest loan.
In order to qualify for Energy Star, energy efficiency would need to be increased by 25% over current levels and lighting and HVAC can only be 50% of the qualifying criteria. Existing Energy Star buildings will remain certified for 5 years from passage of the bill.
In addition, the DOE is required to update and better label buildings for purposes of benchmarking energy usage by building type and climate area. Eventually all new and most existing buildings will be energy labeled.
Finally, the bill contains a requirement for updates to State Building Codes. Specifically, the national model building code would be updated every 3 years. The bill requires energy savings as compared to ASHRAE 90.1-2004 as follows: 30% by 2010, 50% after 2020. Further, each state must certify that is has updated its building code to comply with energy efficiency standards. Specifically, state building codes must meet or exceed ASHRAE 90.1-2007 for energy savings. Each state building code must meet or exceed the national building code once it is updated. The federal government will make $50 million available to the states for this effort. Incentive funding of up to $500,000 will be made available to each state for compliance efforts.
ASHRAE has issued an Update on ASHRAE Standards for Ventilation and Energy. In addition, the letter indicates the anticipated public review dates for the Addendum being considered to the standards. 
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