PORTLAND PRESS HERALD

Bill seeks big push to reduce oil usage
State House: Efficiency Maine Trust, a new agency, could boost conservation, investment and new jobs.

 

By TUX TURKEL, Staff Writer May 18, 2009
A new state energy agency would direct tens of millions of dollars into weatherization, conservation and efficiency programs under a bill facing final consideration in the Maine Legislature.
To be called the Efficiency Maine Trust, the agency would pull together many existing energy-related programs now operating in state government and launch an unprecedented effort to wean Maine's economy from its dependence on oil.
Supporters also expect the public spending to spawn private investment that in time could create thousands of jobs in companies that insulate and inspect homes, as well as make and install alternative energy products and technology.
In its first two years, the trust would rely heavily on federal stimulus money to get off the ground. After that, the agency hopes to receive $50 million a year in lease payments from private companies that have proposed developing energy corridors through the state. It also may issue revenue bonds, and consider the controversial idea of placing a small tax on heating oil and other fuels, similar to the surcharge now on electricity.
The challenge for future politicians, however, will be coming up with enough money to keep the ambitious goals on track.
"I think this bill is going to frame the direction of energy policy in Maine over the next decade," said John Kerry, the state's energy office director.
The bill reflects the work of a special legislative committee set up in the wake of last year's record oil prices. A majority of the panel endorsed the comprehensive plan last week, although Republicans expressed concerns about oversight of the trust and program performance. Those issues will need to be reconciled in the full Legislature before a vote in the next two weeks.
Assuming the bill is approved, a board that will govern the trust, a director and staff will be phased in over the next year. They will take over programs and efforts aimed at upgrading the energy efficiency of all Maine homes and half of all businesses by 2030, and cutting overall heating oil use by at least 20 percent in 2020. Mainers now burn nearly 600 million gallons of heating oil a year, so a 20 percent reduction would amount to 120 million gallons.
Another part of the proposed law would set up a new program in the Maine State Housing Authority to build and rehabilitate affordable rental units and replace older manufactured housing that doesn't meet modern codes. Money would come from revenue bonds and a portion of the state's real estate transfer tax.
This ambitious agenda is taking place against a backdrop of rapid change, and perhaps, fleeting opportunity.
Gov. John Baldacci and other political leaders fear the soaring petroleum prices that threatened Maine's economy a year ago will return after the recession. Facing a crushing budget shortfall, the state is limited in its ability to fund efforts to insulate Mainers from the next oil shock.
Federal stimulus money that could total more than $60 million over two years will give Maine a timely shot of cash to jump-start the oil cutback plan. Expected money from a regional greenhouse-gas reduction plan and an ongoing surcharge on electricity use will contribute millions more.
But in two years, lawmakers and the trust will have to decide how to sustain the programs, said Senate Majority Leader Philip Bartlett, D-Cumberland, who co-chaired the special committee.
"This is a 20-year process," he said. "But the bill puts in place a road map to achieve energy independence in the state."
A potential source of ongoing money is lease payments from energy corridors planned for Maine. Two companies with Canadian ties – Irving Oil Ltd. of New Brunswick and Bangor Hydro-Electric Co., which is owned by Emera Inc. of Nova Scotia – have expressed interest in building energy corridors that could move electricity and perhaps oil and natural gas from the Maritimes through Maine to southern New England.
The law requires that the first $50 million a year of any lease payments go to the trust. The corridor concept has been strongly supported by Baldacci and an influential construction company, Cianbro Corp. They see the corridors as a key for economic development and energy security.
But not everyone's excited about the corridor plans.
Groups that represent organized labor and paper mills teamed up with advocates of liquefied natural gas terminals in Passamaquoddy Bay to oppose any fast-track corridor agreements that they say would give Canada a sweetheart deal. A compromise, stitched into the bill last week, delays corridor development until a study commission reviews the financial value of any leases and the impact on efforts to build LNG terminals and power plants in Maine. A report is due in December.
Ultimately, Kerry and other lease supporters say, it will be more politically popular to get $50 million from Irving Oil than from Maine taxpayers. Without the money, it's not clear how the state will sustain its aggressive weatherization and energy-efficiency efforts.
"That's the $50 million question," Kerry said.
To some participants in the debate, one answer is to extend the small electricity surcharge that funds efficiency programs to heating oil, propane and perhaps wood fuels. Tacking on a 2-cents-per-gallon charge could generate $12 million a year or so in Maine, said Rob Brown, executive director of Opportunity Maine, an advocacy group promoting economic and work force development.
Reliable, sustainable funding is critical, Brown said. Small businesses that insulate homes or install solar panels, for instance, won't invest in equipment and hire people if they think Maine's energy programs will peter out in two years.
But other participants say it's just not possible now for Maine to nail down large, sustainable sources of funding. That's why Republicans on the special committee want ways to measure program performance, and why the trust will be required to report back to the Legislature with future funding suggestions, said Rep. Kenneth Fletcher, R-Winslow.
With money tight, he said, the bill strikes the right balance by using public money to leverage private investment and create long-term jobs tied to renewable energy and efficiency.
"We need a public-private partnership," Fletcher said, "and this is a very good first step."
Staff Writer Tux Turkel can be contacted at 791-6462 or at:
tturkel@pressherald.com

I am sorry I am away for two weeks and unable to participate directly in this important process. I will do my best to take part by e-mail.
 
The BPI building analyst and envelop standards are not intended to be complete evaluator (energy auditor) and installation standards, the MaineHP Standards are.
 
The MaineHP standards are appropriate for a program that moves beyond the MaineHP pilot for a number of reasons. First, they are current and comprehensive. They cover most situations in the field for both energy audits and installations. Second, they are based on the low-income weatherization program standards, 2005 version, written by me and a very capable advisory group made up of low-income program energy auditors. As such, it is appropriate to think of the MaineHP Standards as the middle/upper-income program analog to the Maine Weatherization Standards 2005 (low-income program standards). Third, they include a comprehensive QA procedure. Of course standards like this require regular updating, but I think that can wait for another year or two. I have attached these standards (they are also available on the MaineHP website www.mainehomeperformance.org).
 
Another issue: In Bob’s “Recommended elements. . .” notes, there is no mention of an association with ENERGY STAR. I think the benefits of ENERGY STAR (EPA) partnership are certainly worth the effort. ENERGY STAR is a well recognized brand. Related to this brand issue is MaineHP as a brand. Although there has not been a comprehensive and ongoing marketing campaign during this three-year pilot program, there is name recognition that should be leveraged.
 
Perhaps more importantly, MaineHP has a well developed structure that this new, much larger program could fit into quite nicely. I strongly recommend this new program replace MaineHP rather than risk confusing Maine residents by starting a program with a new name.
 
An issue that concerns me is the quality of installation. Currently, I know of only one or two installers in Maine who are air sealing as they should be. Of course there might be more, I don’t know. I expect there are less than ten installers of dense pack-cellulose installers who are installing cellulose in walls correctly. Installers or weatherization measures must use verification methods whenever possible. This means using a blower door DURING air sealing activities, using an IR camera to check for completeness of cellulose coverage in walls, performing core sampling to check insulation density, regularly testing the take-off pressure on insulation machines, etc. Just as we expect evaluators to rise to the next level of professionalism with their analysis and test-out inspections, we must expect installers to become better by using performance techniques and personally verifying the effectiveness of their work.
 
Rick Karg
Senior Technical Consultant
MaineHP
 
R.J. Karg Associates
220 Meadow Road
Topsham, Maine 04086
207-725-6723
www.karg.com