Energy Market News

January 2008

NATIONAL ENERGY MARKET NEWS…

1. Energy Bill Highlights - The Energy Independence and Security Act, which the President signed on December 19, 2007, will make major changes in how the nation consumes energy. Here's a look at its key elements:

R Vehicle mileage: Requires automakers to boost fleetwide fuel economy for cars and light trucks to 35 mpg by 2020.

R Renewable fuels: Calls for a fivefold increase the amount of biofuels, such as ethanol, added to gasoline, to 36 billion gallons by 2022.

R Light bulbs: All lamps must use 25 percent to 30 percent less energy than today’s products by 2012 to 2014. The phase-in will start with 100-watt lamp in January 2012 and end with 40-watt lamps in January 2014. By 2020, lamps must be 70 percent more efficient.

R The bill also will require all general purpose lighting in Federal buildings to use Energy Star® products or products designated under the Energy Department's Federal Energy Management Program (FEMP) by the end of Fiscal Year 2013

R Sets new efficiency standards for commercial buildings and appliances.

R Greenhouse gases: Boosts federal research into ways to trap carbon dioxide emissions from power plants and store them in the earth.

R Green federal buildings: Speeds up use of energy efficiency technologies and requires new or renovated buildings to use 55% less fossil fuel by 2010 and 100% less by 2030.

R Geothermal power: Encourages new technologies and creates tax incentives to expand the use of energy drawn from the Earth's heat. 12/19 LA Times

2. DOE Finalizes Regulations to Increase Energy Efficiency in New Federal Buildings by 30% - The U.S. Department of Energy (DOE) today announced it has established regulations that require new Federal buildings to achieve at least 30% greater energy efficiency over prevailing building codes. Mandated by the Energy Policy Act of 2005 (EPAct), these standards apply to new federal commercial and multi-family high-rise residential buildings, as well as new federal low-rise residential buildings designed for construction that began on or after January 3, 2007. These standards are also 40% more efficient than the current Code of Federal Regulations (CFR) and carry out portions of President Bush's Executive Order (EO 13423), announced earlier this year, which directed federal agencies to reduce energy intensity and greenhouse gas emissions; substantially increase use and efficiency of renewable energy technologies; and adopt sustainable design practices. http://www.doe.gov/news/5790.htm

3. Oil and the Dollar - Oil prices finally hit $100 a barrel this week, albeit briefly, but breaking through that symbolic barrier is ominous and higher gasoline prices are sure to follow. From $1.80 to $100 in 37 years. Supply disruptions in various places and surging demand in China and India are part of the explanation for this decade's upward trend in oil prices. Oil may rise to $150 on China demand. But perhaps the biggest factor has been largely overlooked: the decline in the value of the dollar. 01/04 Wall Street Journal

4. Congress Passes Construction Bill - Congress recently passed a fiscal year 2008 omnibus appropriations bill that President Bush is expected to sign. The bill combines 11 separate bills that fund most federal agencies through September 30. Estimates show that construction spending in the bill totals $107 billion, up 4% from fiscal year 2007 and up 5.7% from the president's budget request. 12/28 EC&M

5. It's Lights Out for Traditional Light Bulbs - Turn out the lights on traditional incandescent bulbs. A little-noticed provision of the energy bill, which is expected to become law, phases out the 125-year-old bulb in the next four to 12 years in favor of a new generation of energy-efficient lights that will cost consumers more but return their investment in a few months. Under the measure, all light bulbs must use 25% to 30% less energy than today's products by 2012 to 2014. The phase-in will start with 100-watt bulbs in January 2012 and end with 40-watt bulbs in January 2014. By 2020, bulbs must be 70% more efficient. Compact fluorescent bulbs already meet the 70% efficiency standard. 12/16 USA Today

6. Congratulations NAED as You Celebrate Your Centennial - The National Association of Electrical Distributors will commemorate its 100th year of service to the electrical industry this year. To start NAED’s new century, the association has revamped its annual meeting and renamed it the NAED Electrical Leadership Summit. The Centennial Celebration will come to its finale at this meeting in May 2008 in San Francisco. TED Magazine will provide coverage of all distributors and manufacturer members who have passed the centennial landmark in the special commemorative April 2008 issue. http://www.naed100.org/

7. Top News Stories of 2007 by Jim Lucy, Chief Editor, Electrical Wholesaling, Dec 1, 2007 -

1) Another Wild Ride with Copper Prices

2) The Housing Market Goes Thud

3) The Green Market (finally) Gathers Steam

4) Rexel, Sonepar and Consolidated Electrical Distributors (CED) Lead Another Busy Year for Distributor Acquisitions

5) Private-Equity Firms Take Center Stage in CED's Acquisition of USESI and the Sale of HD Supply

6) Acquisitions of Electrical Manufacturers and Distributor Software Companies Continue

7) Private Labeling Challenges Conventional Branding Norms in the Electrical Market

8) Leadership Change at IDEA

9) Watch Out for Wolseley

10) Who's Who at the Zoo. Industry Execs on the Move

8. President Clinton Selects Acuity Brands Lighting to Help Promote Green Products -At a recent ceremony in Seattle, former President Bill Clinton announced Acuity Brands Lighting would be a major partner for lighting products in the Clinton Climate Initiative (CCI). The CCI, a unit of the world renowned Clinton Foundation, is working with the US Conference of Mayors (USCM) to assure US cities use environmentally sustainable lighting products in their infrastructure and municipal building applications. Additionally, over 40 of the world’s largest cities are working with the CCI toward climate change. 12/12 Business Wire

9. Small Businesses to Get Energy Efficiency Help - Small businesses, which make up over 99 percent of businesses domestically and are responsible for half the country's economic output, are poised to take advantage of the same energy efficiency projects that Fortune 500 companies have adopted in recent years. Under a pilot program included in the energy bill signed into law last month, the Small Business Administration (SBA) will offer low-cost loans for small to medium enterprises (SMEs) that want to improve their energy and fuel use. The two-year pilot will lower the fees on 7(a) business loans for efficiency projects and fund grants for Small Business Development Centers that will offer free energy audits and efficiency trainings for small companies. http://greenbiz.com/

10. Report Predicts Bright Future for OLEDs - In a recent report, Glen Allen, Va.-based NanoMarkets, LC, is predicting that organic light-emitting diodes (OLEDs) will "play a major role in lighting applications in the future." However, the organization is uncertain as to how soon this future will arrive and how deeply the devices will penetrate the market. In "Emerging Markets for OLED and Printed Lighting," NanoMarkets is estimating that the current $135.8 million OLED market will grow to almost $174 million in 2008 before increasing in 2009 and 2010 to $304 million and $619 million, respectively. http://www.nanomarkets.net/

11. Lutron Launches Green Campaign - In recognition of the nation's need to cut its energy use, Lutron Electronics, Coopersburg, Pa., is launching a new awareness campaign titled, “Light Greener, Light Better.” One of the goals of the campaign is to let people know that they can control exactly how much light they use for a given task or situation without sacrificing quality — and, in the process, save money and contribute to a healthier environment. 12/’07 Electrical Wholesaling

12. Philips Solid-State Lighting Solutions Demonstrates Future of Light in New Corporate Headquarters - Philips Solid-State Lighting Solutions the new entity formed by Philips' acquisition of Color Kinetics, has completed the finishing touches and officially unveiled its new 50,000-square foot corporate headquarters in Burlington, Massachusetts. Merging the principles of green design with innovative uses of its LED lighting technology throughout, the new space is both a testing ground and a showplace for the future of light. Take a virtual tour of the facility at http://www.colorkinetics.com/corp/hq

13. His Bright Idea: Dominate Energy-Saving Light Bulbs - How many light-bulb makers does it take to change four billion U.S. sockets to compact-fluorescent lights? Ellis Yan says it takes just one: TCP Inc., the largest manufacturer of the energy-efficient bulbs sold in the U.S. -- and, not coincidentally, the company Mr. Yan owns. TCP is well-positioned as consumers seek alternatives to traditional incandescent bulbs. 12/27 Wall Street Journal

14. TCP, Inc. Increases Manufacturing Capacity of Energy Efficient Light Bulbs to 1.4 Million/Day -
The company announced that it is boosting production of its CFL energy efficient light bulbs for the third time in nine months, from 1.1 million to 1.4 million bulbs per day to meet increased consumer demand. The announcement comes in the wake of President Bush signing the federal energy bill, which requires stricter energy efficiency guidelines for lighting and the phase-out of the traditional incandescent light bulb between 2012 and 2014. TCP manufactures 70 percent of the compact fluorescent lamps (CFLs) on the market through a variety of name brand, private label and other lighting manufacturers (OLMs), including n:vision at The Home Depot. www.tcpi.com

15. Cooper Lighting Offers Energy Solutions Workshop - Cooper Lighting's SOURCE lighting education center will hold an Energy Solutions Workshop on January 22 and 23. The two-day workshop focuses on lighting design techniques for industrial, commercial, manufacturing and warehouses. Design concerns are shifting toward methods of minimizing the environmental impact of buildings and reducing energy use. Participants will learn how to retrofit existing facilities with energy efficient lighting system upgrades, as well as the financial benefits and operational impacts of an upgrade. The class fee is $350 and qualifies for up to 12 continuing education credits. Stan Walerczyk joins the SOURCE staff. http://www.cooperlighting.com/

16. Ingersoll Rand to buy Trane for $10.1 billion - Industrial products company Ingersoll Rand this morning said it would buy Trane for $10.1 billion in cash and stock, creating one of the world's largest climate-control businesses. The combined company would have revenues of $17 billion a year, of which $11 billion would come from climate control. 12/17 The Star-Ledger Business Desk

17. Lighting Features in the December 2007 Electrical Contractor -

Healthcare Lighting Creates Opportunities by Pat Woods

No Wires Required: Lighting Controls by Kellie K. Speed

Shedding Light on Commercial Projects by Deborah L. O'Mara

Turn off the Power, Turn on Savings by Debbie McClung

For All the World to See - Large Venue Lighting by Claire Swedberg

18. Transformations in Lighting – 2008 DOE Solid-State Lighting R&D Workshop -
January 29-31, 2008, Sheraton Atlanta Hotel, Atlanta, GA. The annual DOE SSL R&D Workshop provides a forum for lighting industry leaders, fixture manufacturers, product development managers, researchers, technology planners, academia, trade associations, lighting designers, energy efficiency organizations, and utilities to share insights and updates on technology advances and market opportunities. http://www.netl.doe.gov/ssl/AtlantaWorkshop.html

19. Gormley Lights the Way With Ban on Bulbs - Ireland yesterday became the first country in the world to ban the traditional lightbulb, announced by Environment Minister John Gormley in his Carbon Budget. Householders will be forced to switch to new long-life low-energy bulbs in 12 months' time. New legislation is being introduced banning the sale of the normal incandescent lightbulb from January, 2009. Admitting there would be teething problems in the run up to the ban, the minister said that as part of the preparation of the legislation there would be full consultation with all stakeholders. http://www.independent.ie/national-new/

STATE ENERGY MARKET NEWS…

1. Times Square Marks Century of Celebrations - More than a million revelers in Times Square cheered as the giant crystal ball made its 100th drop and a ton of confetti rained down on the urban canyon, ushering in the new year. The first ball was an iron-and-wood contraption lit with 100 25-watt incandescent bulbs, but the Waterford crystal-clad star of this year's extravaganza was lit up with 9,576 tiny light-emitting diodes that organizers said would draw about as much electricity as 10 toasters. Philips Lighting, which made the LEDs, said they would be more than twice as bright as last year's energy-hungry lights and are capable of generating more than 16 million colors. 01/01 AP

2. The Holland Tunnel Has Gone Green - Crews overnight replaced fluorescent lights with light-emitting diodes. More than 1,700 LED fixtures replace some 4,000 fluorescent ones in the tunnel. Port Authority officials say they'll save $340,000 each year in energy and maintenance costs. They will reduce carbon dioxide emissions by about 3 million pounds. The George Washington Bridge's "necklace'' of 156 mercury vapor fixtures are to be replaced with LEDs in January. 12/12 AP

3. Public Service of New Hampshire's Energy Rewards Program - Public Service of New Hampshire (PSNH) is the state’s largest electric utility, serving more than 475,000 homes and businesses in 211 communities. PSNH offers many energy efficiency programs for both residential and commercial customers. Chief among these is the Energy Rewards Program, which grants incentives through a competitive bidding process to commercial and industrial customers who achieve quantifiable energy savings through the installation of energy efficiency measures. Under the Energy Rewards Program, PSNH accepts energy efficiency project proposals from its commercial and industrial customers, or energy service companies representing those customers, including replacing lighting with high efficiency lighting systems and designs, and installing lighting controls to reduce lighting operating hours. http://www.neep.org/newsletter/4Q2007/case_study.html

4. Tampa Electric Makes Free Compact Fluorescent Light Bulbs Available for Customers -
As part of its launch of a new lineup of conservation programs, Tampa Electric is making a free pack of eight compact fluorescent light (CFL) bulbs available to any customer who participates in the company's free Home Energy Audit. This audit is one of three free energy audits; along with the Online Home Energy Audit and Telephone Audit (available in the first quarter of 2008). Visit Tampa Electric's new energy saving programs at www.tampaelectric.com 12/14 Business Wire

5. Electric Light & Power’s 2007 Utility of the Year: FPL Group - Florida Power & Light Group’s at the forefront of clean energy production and energy conservation and hasn’t shied away from the global warming debate; in fact, it’s assumed a leadership position. FPL Group is already No. 1 in wind energy production in the U.S., No. 1 in solar energy production, and No.1 in energy efficiency programs, and now it’s No. 1 with EL&P for 2007. http://uaelp.pennnet.com/

6. Charleston Launches $10 Million Energy Efficiency Effort - The city of Charleston is launching a $10 million effort to become more energy efficient and reduce greenhouse gas emissions. The city plans to use high-efficiency LED fixtures to light parking garages and install sensors in city buildings to cut energy use. 12/25 AP

7. EPA Rejects Calif. Effort to Regulate GHG; Hill, Court Fights Ahead - U.S. EPA yesterday blocked California's bid to implement its own regulations for vehicle greenhouse gas emissions, igniting not only a certain court battle but also a likely political fight that could play a central role in Congress' efforts to craft comprehensive climate change legislation. http://www.eenews.net/

8. Energy Efficient Lightbulb Program Beats Expectations - A Dominion Virginia Power program to boost energy conservation in Virginia through efficient light bulbs has shattered expectations. Dominion is paying for a discount on compact fluorescent light bulbs, which use about 75 percent less electricity than traditional bulbs, sold at Home Depot locations across the state. When the program started in October, the state's largest utility had hoped to sell 150,000 bulbs by the end of the year. But customers broke that mark by the end of October and bought more than 525,000 by the end of the year. 01/04 McClatchy-Tribune Regional News

9. Push to Curb Consumption - The Tennessee Valley Authority was created to help bring cheap electric power and faster economic growth to an impoverished portion of Appalachia during the Great Depression. But nearly 75 years after its founding, TVA now is eager to slow its growth, particularly in the amount of electricity it has to generate during times of peak demand. By April, utility officials expect to adopt a new conservation plan to help limit the growth of electricity consumption in the region and to reshape the valley's energy load away from peak periods. 01/05 Chattanooga Times

10. APS Announces Improved Energy Conservation Over Past 2 Years - Arizona Public Service customers have saved enough electricity through conservation programs in the past two years to power about 190,000 homes, according to the programs' managers. After about two years, about 4 million fluorescent bulbs have been sold; 4,500 new air-conditioning units have yielded rebates for customers; 1,500 new houses have been equipped with high-efficiency appliances and 20,500 others have been committed; and more than 1,300 homes of low-income customers have been retrofitted with more efficient appliances. Still, the savings amounts to less than 1 percent of the total energy demand of APS customers but they are looking forward to it getting much higher. www.aps.com

11. Edison Offers Resolutions for an Energy Efficient 2008 - Southern California Edison (SCE) wishes its customers a peaceful New Year with these 10 ideas to make their homes more energy efficient throughout the year:

1) Light up your life: Pledge to switch out at least one regular incandescent bulb for a CFL at www.sce.com/cfl SCE has managed to place inexpensive CFL bulbs in more than 1500 stores--at reduced prices (often just 99 cents). Look for displays that have SCE's logo.

2) Survey says: Take the Home Energy Survey online or in person at www.sce.com You'll get custom information on ways to make your home or business more efficient, plus a free compact fluorescent light (CFL), low-flow showerhead and two faucet aerators.

3) Out with the old!: Let SCE haul away your old inefficient appliances and we'll pay you.

4) Chill your bill: Get up to $200 credit on your summer electricity bills when you sign up for Summer Discount Plan at www.sce.com/summer

5) Beat the heat: Consider energy-efficient air-conditioning alternatives.

6) More cash in your stash: SCE offers many rebates at http://www.sce.com/RebatesandSavings/

7) Stay in tune: Much like an automobile, an air conditioning system needs to be regularly tuned up. Customers can find a list of contractors near them at www.sce.com/summer

8) Leave a tip: Share energy-saving ideas with your neighbors at www.sce.com/leaveatip the year.

9) Become a vampire slayer: "Energy vampires" refers to electronic equipment, appliances and devices that use energy 24 hours a day, even when you think they're turned off.

10) Follow the sun: You'll earn rebates when you provide your own clean, renewable energy from solar panels when you take advantage of the California Solar Initiative. Learn more at www.sce.com/RebatesandSavings/CaliforniaSolarInitiative/ 12/31 Business Wire

MONTHLY ENERGY MARKET FEATURE…

http://www.aceee.org/energy/national/07nrgleg.htm

H.R.6

Energy Independence and Security Act of 2007

http://energy.senate.gov/public/_files/getdoc1.pdf

The new Congress put energy legislation high on its agenda, with final legislation passing and signed by the President on December 19, 2007. Major efficiency provisions in the new 2007 law are as follows:

Corporate Average Fuel Economy Standards. The legislation calls for a 35 mpg CAFE standard for cars and light trucks by 2020, with “maximum feasible” increases beyond this date. The provision also sets in motion the first fuel economy standards for heavy-duty trucks. The final bill also gradually phases out extra fuel economy credits for dual fuel vehicles, with the credits ending in 2020.

Appliance and Equipment Efficiency Standards. The new law contains many provisions setting new minimum efficiency standards based on consensus agreements between industry and ACEEE. Products for which standards are set include:

R Appliances: dishwashers and dehumidifiers (updates to current federal standard)

R Residential boilers (update to current federal standard)

R Electric motors (updates current standards and enacts new standards on many special- and definite-purpose motors as well as motors of 201-400 horsepower) See ACEEE's 2007 report on this provision

R Incandescent reflector lamps: applies 1992 standards to BR, ER and R20 lamps (categories previously exempted from 1992 law)

R External power supplies (federalizes standard adopted by California and other states)

R Metal halide lamp fixtures (based on standard adopted by California and other states)

R Walk-in coolers and freezers (based on California, Rhode Island and Maryland standards)

R In addition, the law directs DOE to conduct new rulemakings on residential refrigerators and clothes washers, on standby power use of currently regulated appliances, and to revise all standards and test procedures on a regular schedule. The bill also allows DOE to expedite rulemakings in response to broad consensus agreements on recommended new standards

Lamp Efficiency Standards. The bill sets lamp efficiency standards for common light bulbs, requiring them to use about 20-30% less energy than present incandescent bulbs by 2012-2014 (phasing in over several years) and requiring a DOE rulemaking to set standards that will reduce energy use to no more than about 65% of current lamp use by 2020. The initial targets can be met by advanced incandescent lamps the major manufacturers are just introducing to the market using halogen capsules with infrared reflective coatings. The longer-term targets will likely be met by compact fluorescent lamps and other advanced technologies such as light-emitting diodes (LEDs) and very advanced incandescent lamps now in development. See Craig DiLouie’s white paper for more details of the Act's major lighting provisions:

http://www.aboutlightingcontrols.org/education/papers/2008_energy_law.shtml#lightbulbs

Subtitle B--Lighting Energy Efficiency

SEC. 321. EFFICIENT LIGHT BULBS.

GENERAL SERVICE INCANDESCENT LAMPS

Rated Lumen Ranges	Maximum Rate Wattage	Minimum Rate Lifetime	Effective Date
1490-2600	72 (21-36 l/w)	1,000 hours	1/1/2012
1050-1489	53 (20/28 l/w)	1,000 hours	1/1/2013
750-1049	43 (17-24 l/w)	1,000 hours	1/1/2014
310-749	29 (11-26 l/w)	1,000 hours	1/1/2014

SEC. 322. INCANDESCENT REFLECTOR LAMP EFFICIENCY STANDARDS.

SEC. 323. PUBLIC BUILDING ENERGY EFFICIENT AND RENEWABLE ENERGY SYSTEMS.

SEC. 3313. USE OF ENERGY EFFICIENT LIGHTING FIXTURES AND BULBS

SEC. 324. METAL HALIDE LAMP FIXTURES.

SEC. 655. BRIGHT TOMORROW LIGHTING PRIZES COMMERCIAL BUILDINGS TAX DEDUCTION

TITLE IV--ENERGY SAVINGS IN BUILDINGS AND INDUSTRY

Regional Standards. The legislation allows DOE to set up to one regional standard for heating products and two regional standards for cooling products, in addition to the main national standard. The intent is to better accommodate the range of climatic conditions across the U.S. The provision only allows regional standards if economically justified, including consideration of economic impacts on manufacturers, distributors and contractors.
Industrial Efficiency Programs. The bill updates the authorization for DOE's industrial program to reflect challenges facing U.S. manufacturing. In particular, the bill addresses the need to develop new manufacturing processes and the ability to make use of alternative feed stocks in response to the increasing cost and scarcity of energy resources.
Combined Heat and Power, Recycled Energy and District Energy. The bill contains important new provisions that promote combined heat and power (CHP), recycled energy and district energy systems. Provisions:

R Direct the quantification of the potential for recycled energy

R Authorize the expansion of Regional CHP Assistance Centers

R Encourage the rationalization of utility grid access for CHP and recycled energy systems

R Authorize a new generation of energy efficiency programs for public buildings with funding through a grant program for construction of infrastructure including CHP, recycled energy and district energy systems.

Commercial Building Initiative. Provision authorizes a Commercial Building Initiative (CBI) combining research, development, and deployment, to be run by DOE with input from an industry consortium. The goal of the initiative is for all new commercial buildings to use zero energy on net by 2030 (i.e. they produce as much energy as they use) and all existing buildings to meet the same goal by 2050. The provision authorizes substantial funding but it's unclear how much funding the program will get through the Congressional appropriations process.