II
114th CONGRESS
1st Session
S. 878
IN THE SENATE OF THE UNITED STATES
March 26, 2015
Mr. Sanders (for himself, Ms. Cantwell, Mr. Wyden, Mr. King, Mr. Whitehouse, Mr. Markey, and Mr. Franken) introduced the following bill; which was read twice and referred to the Committee on Energy and Natural Resources
A BILL
To establish a State residential building energy efficiency upgrades loan pilot program.
State residential building energy efficiency upgrades loan pilot program
Loans for residential building energy efficiency upgrades
Part D of title III of the Energy Policy and Conservation Act (42 U.S.C. 6321 et seq.) is amended by adding at the end the following:
Loans for residential building energy efficiency upgrades
Definitions
In this section:
Consumer-friendly
The term consumer-friendly, with respect to a loan repayment approach, means a loan repayment approach that—
emphasizes convenience for customers;
is of low cost to consumers; and
emphasizes simplicity and ease of use for consumers in the billing process.
Eligible entity
The term eligible entity means—
a State or territory of the United States; and
a tribal organization (as defined in section 4 of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 450b)).
Energy advisor program
In general
The term energy advisor program means any program to provide to owners or residents of residential buildings advice, information, and support in the identification, prioritization, and implementation of energy efficiency and energy savings measures.
Inclusions
The term energy advisor program includes a program that provides—
interpretation of energy audit reports;
assistance in the prioritization of improvements;
assistance in finding qualified contractors;
assistance in contractor bid reviews;
education on energy conservation and energy efficiency;
explanations of available incentives and tax credits;
assistance in completion of rebate and incentive paperwork; and
any other similar type of support.
Energy efficiency
The term energy efficiency means a decrease in homeowner or residential tenant consumption of energy (including electricity and thermal energy) that is achieved without reducing the quality of energy services through—
a measure or program that targets customer behavior;
equipment or energy systems;
a device; or
other material.
Energy efficiency upgrade
In general
The term energy efficiency upgrade means any project or activity—
the primary purpose of which is increasing energy efficiency; and
that is carried out on a residential building.
Inclusions
The term energy efficiency upgrade includes the installation or improvement of a renewable energy facility for heating or electricity generation serving a residential building carried out in conjunction with an energy efficiency project or activity.
Program entity
The term program entity means a local government, utility, or other entity that carries out a financing program under subsection (e)(2)(A) pursuant to a contract or other agreement with an eligible entity.
Recipient household
The term recipient household means the owner or tenant of a residential building who receives financing under this section for an energy efficiency upgrade of the residential building.
Residential building
In general
The term residential building means a building used for residential purposes.
Inclusions
The term residential building includes—
a single-family residence;
a multifamily residence composed not more than 4 units; and
a mixed-use building that includes not more than 4 residential units.
Establishment of program
In general
The Secretary shall establish a program under this part under which the Secretary shall make available to eligible entities loans for the purpose of establishing or expanding programs that provide to recipient households financing for energy efficiency upgrades of residential buildings.
Consultation
In establishing the program under paragraph (1), the Secretary shall consult, as the Secretary determines to be appropriate, with stakeholders and the public.
No requirement to participate
No eligible entity shall be required to participate in any manner in the program established under paragraph (1).
Deadlines
The Secretary shall—
not later than 1 year after the date of enactment of this section, implement the program established under paragraph (1) (including soliciting applications from eligible entities in accordance with subsection (c)); and
not later than 2 years after the date of enactment of this section, disburse the initial loans provided under this section.
Applications
In general
To be eligible to receive a loan under this section, an eligible entity shall submit to the Secretary an application at such time, in such manner, and containing such information as the Secretary may require.
Selection date
Not later than 21 months after the date of enactment of this section, the Secretary shall select eligible entities to receive the initial loans provided under this section, in accordance with the requirements described in paragraph (3).
Requirements
In selecting eligible entities to receive loans under this section, the Secretary shall—
to the maximum extent practicable, ensure—
that both innovative and established approaches to the challenges of financing energy efficiency upgrades are supported;
that energy efficiency upgrades are conducted and validated to comply with best practices for work quality, as determined by the Secretary;
regional diversity among eligible entities that receive the loans, including participation by rural States and small States;
significant participation by families with income levels at or below the median income level for the applicable geographical region, as determined by the Secretary; and
the incorporation of an energy advisor program by, as applicable—
eligible entities; or
program entities;
evaluate applications based primarily on—
the projected reduction in energy use, as determined in accordance with such specific and commonly available methodology as the Secretary shall establish, by regulation;
the creditworthiness of the eligible entity; and
the incorporation of measures for making the loan repayment system for recipient households as consumer-friendly as practicable;
evaluate applications based secondarily on—
the extent to which the proposed financing program of the eligible entity incorporates best practices for such a program, as determined by the Secretary;
whether the eligible entity has created a plan for evaluating the effectiveness of the proposed financing program; and
whether that plan includes—
a robust strategy for collecting, managing, and analyzing data, as well as making the data available to the public; and
experimental studies, which may include investigations of how human behavior impacts the effectiveness of efficiency improvements;
the extent to which Federal funds are matched by funding from State, local, philanthropic, private sector, and other sources;
the extent to which the proposed financing program will be coordinated and marketed with other existing or planned energy efficiency or energy conservation programs administered by—
utilities and rural cooperatives;
State, tribal, territorial, or local governments; or
community development financial institutions; and
such other factors as the Secretary determines to be appropriate; and
not provide an advantage or disadvantage to applications that include renewable energy in the program.
Administrative provisions
Term
The Secretary shall establish terms for loans provided to eligible entities under this section—
in a manner that—
provides for a high degree of cost recovery; and
ensures that, with respect to all loans provided to or by eligible entities under this section, the loans are competitive with, or superior to, other forms of financing for similar purposes; and
subject to the condition that the term of a loan provided to an eligible entity under this section shall not exceed 35 years.
Interest rates
In general
Subject to subparagraph (B), the Secretary, at the discretion of the Secretary, shall charge interest on a loan provided to an eligible entity under this section at a fixed rate equal, or approximately equal, to the interest rate charged on Treasury securities of comparable maturity.
Leveraged loans
The interest rate and other terms of the loans provided to eligible entities under this section shall be established in a manner that ensures that the total amount of the loans is equal to not less than 20 times, and not more than 50 times, an amount equivalent to 80 percent of the amount appropriated for administrative and general financial support costs pursuant to subsection (g)(2).
No penalty on early repayment
The Secretary shall not assess any penalty for early repayment by an eligible entity of a loan provided under this section.
Return of unused portion
As a condition of receipt of a loan under this section, an eligible entity shall agree to return to the general fund of the Treasury any portion of the loan amount that is unused by the eligible entity within a reasonable period after the date of receipt of the loan, as determined by the Secretary.
Use of funds
In general
An eligible entity shall use a loan provided under this section to establish or expand 1 or more financing programs—
the purpose of which is to enable recipient households to undertake energy efficiency upgrades of residential buildings;
that may, at the sole discretion of the eligible entity, require an outlay of capital by recipient households in accordance with the goals of the program under this section; and
that incorporate a consumer-friendly loan repayment approach.
Structure of financing program
A financing program of an eligible entity may—
consist—
primarily or entirely of a financing program administered by—
the applicable State; or
a program entity; or
of a combination of programs described in clause (i);
rely on financing provided by—
the eligible entity; or
a third party, acting through the eligible entity; and
include a provision pursuant to which a recipient household shall agree to return to the eligible entity any portion of the assistance that is unused by the recipient household within a reasonable period after the date of receipt of the assistance, as determined by the eligible entity.
Form of assistance
Assistance from an eligible entity under this subsection may be provided in any form, or in accordance with any program, authorized by Federal law (including regulations), including in the form of—
a revolving loan fund;
a credit enhancement structure designed to mitigate the effects of default; or
a program that—
adopts any other approach for providing financing for energy efficiency upgrades producing significant energy efficiency gains; and
incorporates measures for making the loan repayment system for recipient households as consumer-friendly as practicable.
Scope of assistance
Assistance provided by an eligible entity under this subsection may be used to pay for costs associated with carrying out an energy efficiency upgrade, including materials and labor.
Additional assistance
In addition to the amount of the loan provided to an eligible entity by the Secretary under subsection (b), the eligible entity or program entity, as applicable, may provide to recipient households such assistance under this subsection as the eligible entity or program entity considers to be appropriate from any other funds of the eligible entity or program entity, including funds provided to the eligible entity by the Secretary for administrative costs pursuant to this section.
Limitations
Interest rates
Interest charged by eligible entities
The interest rate charged by an eligible entity on assistance provided under this subsection—
shall be fixed; and
shall not exceed the interest rate paid by the eligible entity to the Secretary under subsection (d)(2).
Interest charged by program entities
A program entity that receives funding from an eligible entity under this subsection for the purpose of capitalizing a residential energy efficiency financing program may charge interest on any loan provided by the program entity at a fixed rate that is as low as practicable, but not more than 5 percent more than the applicable interest rate paid by the eligible entity to the Secretary under subsection (d)(2).
No penalty on early repayment
An eligible entity or program entity, as applicable, shall not assess any penalty for early repayment by any recipient household to the eligible entity or program entity, as applicable.
Reports
Eligible entities
In general
Not later than 2 years after the date of receipt of the loan, and annually thereafter for the term of the loan, an eligible entity that receives a loan under this section shall submit to the Secretary a report describing the performance of each program and activity carried out using the loan, including anonymized loan performance data.
Requirements
The Secretary, in consultation with eligible entities and other stakeholders (such as lending institutions and the real estate industry), shall establish such requirements for the reports under this paragraph as the Secretary determines to be appropriate—
to ensure that the reports are clear, consistent, and straightforward; and
taking into account the reporting requirements for similar programs in which the eligible entities are participating, if any.
Secretary
The Secretary shall submit to Congress and make available to the public—
not less frequently than once each year, a report describing the performance of the program under this section, including a synthesis and analysis of the information provided in the reports submitted to the Secretary under paragraph (1)(A); and
on termination of the program under this section, an assessment of the success of, and education provided by, the measures carried out by eligible entities during the term of the program.
Authorization of appropriations
There are authorized to be appropriated to the Secretary to carry out this section—
$37,500,000 for energy advisor programs;
$25,000,000 for administrative and general financial support costs to the Secretary of carrying out this section; and
$37,500,000 for administrative costs to States in carrying out this section.
.
Reorganization
In general
Part D of title III of the Energy Policy and Conservation Act (42 U.S.C. 6321 et seq.) is amended—
by redesignating sections 362, 363, 364, 365, and 366 as sections 364, 365, 366, 363, and 362, respectively, and moving the sections so as to appear in numerical order;
in section 362 (as so redesignated)—
in paragraph (3)(B)(i), by striking section 367, and
and inserting section 367 (as in effect on the day before the date of enactment of the State Energy Efficiency Programs Improvement Act of 1990 (42 U.S.C. 6201 note; Public Law 101–440)); and
; and
in each of paragraphs (4) and (6), by striking section 365(e)(1)
each place it appears and inserting section 363(e)(1)
;
in section 363 (as so redesignated)—
in subsection (b), by striking the provisions of sections 362 and 364 and subsection (a) of section 363
and inserting sections 364, 365(a), and 366
; and
in subsection (g)(1)(A), in the second sentence, by striking section 362
and inserting section 364
; and
in section 365 (as so redesignated)—
in subsection (a)—
in paragraph (1), by striking section 362,
and inserting section 364;
; and
in paragraph (2), by striking section 362(b) or (e)
and inserting subsection (b) or (e) of section 364
; and
in subsection (b)(2), in the matter preceding subparagraph (A), by striking section 362(b) or (e)
and inserting subsection (b) or (e) of section 364
.
Conforming amendments
Section 391 of the Energy Policy and Conservation Act (42 U.S.C. 6371) is amended—
in paragraph (2)(M), by striking section 365(e)(2)
and inserting section 363(e)(2)
; and
in paragraph (10), by striking section 362 of this Act
and inserting section 364
.
Clerical amendment
The table of contents of the Energy Policy and Conservation Act (42 U.S.C. 6201 note; Public Law 94–163) is amended by striking the items relating to part D of title III and inserting the following:
Part D—State energy conservation programs
Sec. 361. Findings and purpose.
Sec. 362. Definitions.
Sec. 363. General provisions.
Sec. 364. State energy conservation plans.
Sec. 365. Federal assistance to States.
Sec. 366. State energy efficiency goals.
Sec. 367. Loans for residential building energy efficiency upgrades.
.
Offset
Section 422(f) of the Energy Independence and Security Act of 2007 (42 U.S.C. 17082(f)) is amended—
in paragraph (3), by striking and
after the semicolon at the end; and
by striking paragraph (4) and inserting the following:
$200,000,000 for each of fiscal years 2013 through 2015; and
$166,666,666 for each of fiscal years 2016 through 2018.
.
