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increased penetration of improved technologies in u.s. and world markets leading to earlier price reductions for efficient products;

generally increased availability of cost-effective technologies, for a range of applications, for preventing, controlling, and mitigating greenhouse gas emissions and, wherever possible, for also recovering energy;

earlier penetration by existing efficient products sending the signal to manufacturers that there is

there is a market for such products, and eventually for even more advanced technologies; and finally,

improved information and accelerating demand for energy efficiency investments will encourage changes in utility regulations relating to potential efficiency investments.

We believe that these measures can have substantial effects. To address energy efficiency objectives, EPA has developed a fivepart strategy: (1) corporate and government purchasing; (2)

enhanced product markets; (3) regulatory and legal reforms; (4)

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energy; and (5) expanded international markets.

EPA believes that

this strategy of efficiently using energy resources can costeffectively achieve reductions in emissions of greenhouse gases

below the levels which they would otherwise reach in future years,

while at the same time promote economic growth.

In the last two decades, U.S. energy consumption per unit of GNP has fallen by 30%, mostly as a result of the normal functioning

of the market.

"Green Lights" and related EPA programs targeted at

electricity consumption are part of an overall movement to improve the efficiency of energy use, including the Administration's National Energy Strategy, as well as utilities' integrated resource - 3

planning and demand-side management programs. We are coordinating closely with the Department of Energy on all of these efforts.

best way to explain how this strategy would work is to place it in

the context of programs that EPA has already developed, or

is

currently developing, in each of these strategic areas.

Corporate and Government Purchasing

Our flagship program in the area of corporate and government purchasing is "Green Lights," which was formally launched on

January 16, 1991.

Green Lights is a voluntary pollution prevention

partnership between EPA and corporations, States

or local governments. Green Lights partners commit to evaluating current lighting needs throughout their facilities and installing energyefficient lighting wherever it is profitable (as measured by the

prime rate plus 6 percent). EPA provides technical assistance through building survey software, support to a product testing

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assistance sources, and public recognition.

EPA believes this program will be successful, since over 400

participants already signed up--nearly two billion square feet

committed--which is more than the office space in New York, Los

Angeles, Chicago, Houston, Dallas and Detroit combined.

While corporations have five years to complete their upgrades,

results from preliminary installations

installations look quite promising: reports received indicate that savings of 40-75% in lighting electricity consumption have been realized, exceeding some

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previously published technical estimates.

Preliminary analyses

indicate that investment in energy efficient lighting resulting

from utility including integral resource planning and demand-side

management, as well as Green Lights--could lower greenhouse gas emissions from electricity production by millions of tons.

Why have these lighting upgrades not happened earlier, given

that the investments in efficient lighting products are

all

profitable? There are a variety of reasons. The facilities manager is responsible for lighting--and usually also charged with

making the elevators run and ensuring that the building temperature

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money, and able to sort through the various products and their

claims, adequate and reliable information and the organizational support may not always be available to make the necessary

investments.

EPA's Green Lights program requires participants to establish

efficient lighting as a strategic corporate decision undertaken at

a high level within the corporation and it also provides information regarding the coordination of options available from

the existing range of lighting products as a system. The software, product testing and financing information support provided by EPA

helps the corporation make the most attractive upgrades.

And the

public recognition afforded by the Green Lights program, as well as

the significant potential savings, provide incentives for corporate

leaders to commit to improving their energy efficiency.

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same time,

thanks to

changes in

State regulatory climates,

utilities

are starting to make major investments in energy efficiency measures in conjunction with their customers, increasing

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shell improvements. As with lighting, efficient technologies exist today that could significantly reduce building energy needs. These technologies include variable speed drives for air handlers and

chillers, reflective painting on rooftops and window improvements.

Following up

on

interest from some of

our

Green Lights

partners, EPA is also exploring the possibility of a holistic program to stimulate corporate energy efficiency across the board-in other words, a green energy corporation program that would require participants to ensure that all equipment purchases are consistent with the principles of life-cycle profitability.

EPA's Green Lights--and similar "green" programs--demonstrate

that significant pollution prevention may be achieved by providing

information and technical advice to corporations and government

offices.

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Enhanced Product Markets

A

second aspect of EPA's approach is to provide signals to

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technologies that manufacturers can produce. EPA's premiere example of enhanced product markets is the "Golden Carrot" super

efficient refrigerator program.

The Golden Carrot program takes

the rebates utilities have agreed to provide to their customers who

buy efficient refrigerators after 1994 and aggregates them into a

single bid pool.

Manufacturers then bid on this pool of rebate

money. The bid pool is offered to the manufacturer that is able to

provide the greatest number

(non-chlorofluorocarbon using)

super-efficient refrigerators at the least cost by 1994 (or 1995).

Under present law, the Department of Energy (DOE) standard is

applied to all refrigerators as a minimum standard.

The winning

refrigerator model is required to be 25 percent more efficient than

the 1993 DOE appliance standard, and may be as much as 50 percent more efficient. The draft request for proposals (RFP) is currently being reviewed by the public and will be offered in June of this

year.

The first super-efficient refrigerators will be shipped as

early as

1994.

The rebates will be awarded directly to the

manufacturers.

Opportunities for many other "Golden Carrot" programs exist.

In fact, an organization has recently been formed by EPA, utilities

and conservation groups--the Consortium for Energy Efficiency--to coordinate "Golden Carrot" and other utility demand-side management

programs.

The consortium strives for similar approaches among

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