Delays and Uncertain Energy Savings in Program To Promote State Energy Conservation

EMD-80-97: Published: Sep 2, 1980. Publicly Released: Sep 2, 1980.

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The Energy Conservation and Production Act of 1976 authorized four programs to encourage and facilitate the implementation of energy conservation and renewable-resource measures in residences, nonresidential buildings, and industrial plants. The act specifically requires GAO to review the four program aspects; program effectiveness, energy savings, an accounting by state of the State Energy Conservation Program (SECP), and compliance monitoring, and to report its findings to Congress annually for fiscal years 1977, 1978, and 1979. In the second annual report covering activities through 1978, SECP implementation in four Department of Energy (DOE) regional offices and eight states were reviewed.

The goal of SECP is to reduce the energy consumption of each state by about 5 percent by 1980. However, the program has been hampered by long delays in enacting required State legislation, slippages in milestone dates, and reductions in scope in many state program measures. Although reported energy savings for 1978 were 13 percent of the goal, GAO did not believe that the goal would be attained by 1980. It believed that the reported savings were overstated and not a valid measure of the actual savings. Deficiencies were identified in the financial and program reporting systems used in the SECP which must be corrected before the states and DOE can effectively monitor and manage the program. To adequately administer, control, and measure the success of the SECP, DOE needs to monitor and compare program results with program expenditures. However, states were not asked to submit financial data in a format which would allow for comparing program results with expenditures. Progress was difficult to assess because the content and format used by the states in their progress reports varied. Monitoring activities in the regional offices visited were hindered by insufficient staff.

Recommendation for Executive Action

  1. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The Secretary of Energy should: reassess the compliance determinations for those states considered to be in compliance with the mandatory SECP requirements, especially mandatory thermal and lighting standards. In cooperation with the states, the Secretary should reevaluate both mandatory and optional program measures in order to: (1) determine if changes and improvements are needed in their scope to make them attainable; (2) establish program measure goals and milestones that are realistic and attainable; and (3) revise state plans and goals accordingly. The Secretary should provide specific guidance and technical assistance needed by the states to estimate and measure both projected future and actual savings as a result of the program. Based on the reevaluation of the scope and progress of state plans and program measures recommended above, the Secretary should work with the states to revise their energy savings goals. Further, the Secretary should ensure that the states implement the DOE monitoring system, when approved by the Office of Management and Budget, to provide DOE with the following assurances: financial systems at the state level are sufficient to provide accurate cost information by program measure; and progress reporting by the states is in sufficient detail to provide accurate, consistent, and complete information on the status of each program measure. Finally, the Secretary, should review with the states the federal requirements concerning the use of federal funds, focusing on letter of credit procedures.

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