A bipartisan coalition of Senate and House Members today were joined by rural electric cooperatives and energy industry leaders to introduce legislation establishing a Rural Energy Savings Program to create jobs, save American families and businesses money on their electric bills, and reduce air pollution. The legislation (H.R. 4785 in the House) is estimated to create 20,000 to 40,000 jobs a year.
The bill provides $4.9 billion in loan authority through the U.S. Department of Agriculture's Rural Utilities Service (RUS) to electric cooperatives to offer low-interest micro-loans to residential and small business customers for energy-saving retrofit and structural improvements. The program will be a boon for the domestic manufacturing and construction industries, as energy-efficiency products are almost exclusively manufactured in the United States and installation jobs cannot be exported. The program builds on the existing co-op infrastructure that has strong community ties and a demonstrated 75-year history of on-bill financing for consumer loans.
Remarks from original co-sponsors of the bill:
House Majority Whip James E. Clyburn (D-SC): "This bill provides for energy conservation, job creation and cost-effective upgrades that will improve consumers' quality of life. There is such broad support for this initiative because it is a win-win-win proposition."
Senator Lindsey Graham (R-SC): "I am proud to work with Congressman Clyburn and others on what I believe will prove to be a worthwhile idea. This is a plan that will help consumers, particularly those in rural areas of our state and nation, become more energy efficient and lower their electricity costs. It is smart policy to take a small, limited amount of federal dollars and empower people to help themselves and, as a result, help our country. By turning this idea into law, our nation will be more energy independent and less dependent on foreign sources of energy. I am proud to be part of this effort and hope we can make it happen this year."
Senator Tim Johnson (D-SD): "This unique legislation breaks down the barriers some homeowners face in making energy efficient upgrades. In making low-interest loans available to consumers in this way, they won't have wait years to see the cost-effective benefits of making improvements that are good for the environment and their bottom line."
Senator Jeanne Shaheen (D-NH): "Retrofitting and weatherizing buildings is one of our greatest opportunities to create jobs and help with our continued economic recovery. This legislation will help create jobs in rural areas hit hard during these difficult times and help families and businesses reduce their energy bills. We can kick-start our construction industry by providing new sources of financing to retrofit homes and businesses. We need to invest in America, and this legislation does just that."
Senator Jeff Merkley, (D-OR): "For our rural communities to recover and thrive in the wake of the economic crisis, we need to put people back to work and lower energy costs for families and the Rural Energy Savings Program does both. This program will help the families and businesses in rural areas who can't afford the cost of a home or building renovation by offering them low-cost loans that they can repay out of the money they will save on their energy bills."
Senator Michael Bennet (D-CO): "Rural America has been hit hard by the economic downturn. This bill will help rural economies recover by creating thousands of good-paying jobs in Colorado and across the country. Not only are these jobs that will help reduce pollution, save families money and increase our energy security; they are jobs that will be created right here in Colorado and can't be shipped overseas. The Rural Energy Savings Program is commonsense, bipartisan bill supported by a broad coalition of partners, and I look forward to getting it passed into law."
U.S. Rep. Tom Perriello (D-VA): "Rural households are getting hit the hardest with rising energy costs. These efficiency programs will not only create jobs locally, but make our rural homes more sustainable and cost efficient in the long run. I'm proud to be part of this bipartisan bill because saving on energy costs and creating clean energy jobs is something both parties can agree on."
U.S. Rep. Ed Whitfield (R-KY): "As our nation works to develop an energy policy which utilizes our own domestic resources while holding down costs, it is essential we explore ways to improve energy efficiency and, in turn, better manage the demand for electricity. Currently our electricity grid is operating at maximum capacity. Increasing our energy efficiency is one of the best proven ways to free up energy on our electricity grid. This bill is a win for American consumers and a win for improving energy efficiency across the country."
Trained auditors and contractors will conduct energy audits to determine what sorts of energy efficiency improvements are warranted. Typical consumer loans will be $1,500 to $7,000, and will cover sealing, insulation, heat pumps, HVAC systems, boilers, roofs and other improvements that the utility has demonstrated to RUS will produce sufficient savings. Participating consumers repay the co-ops for the installation and material costs through an extra charge on their utility bills within not more than a 10 year window. The energy savings from the upgrade will cover most, if not all, of the cost of the loan. Consumers will save more on their energy bills after the loan is repaid, saving most families hundreds of dollars annually. Every dollar loaned by RUS to the co-ops is repaid to the taxpayers within ten years after the cooperative re-lends the funds to the consumer.
Original Co-sponsors: HOUSE: Rep. Clyburn (D-SC), Rep. Perriello (D-VA), Rep. Whitfield (R-KY), Rep. Spratt (D-SC) SENATE: Sen. Merkley (D-OR), Sen. Graham (R-SC), Sen. Lugar (R-IN), Sen. Shaheen (D-NH), Sen. Johnson (D-SD), Sen. Bennet (D-CO).