Energy policy, global warming concerns, and climate change are all integrally linked in the eyes of Washington policy makers. Congress and the White House are both leading a charge to change the way produce energy and its impact on the environment.

Congress is developing legislation that will steer our energy production toward more renewable resources while maximizing efficiencies in appliances, vehicles, and buildings that consume energy. The Senate has begun work on an energy bill starting with non-controversial legislation that has consensus support. The Senate Energy and Natural Resources committee approved four bills with plans on moving more legislation in the future. One of the bills approved out of committee would allow a petition process to establish new testing procedures or efficiency standards of appliances. The impacts on the HVACR industry mean that testing procedures and efficiency standards could be updated more frequently and stringently. The Senate Finance Committee is alos considering a tax component for energy efficiency. ACCA is lobbying to include commercial energy improvment incentives through accelerated depreciation (the Cool and Efficiency Buildings Act), expensing allowance for higher efficiency HVACR equipment, or bonus depreciation for higher efficiency HVACR equipment.

Last month, the House Energy and Commerce Committee released a “discussion draft” bill dealing with energy and climate change. Unlike the Senate bill, the draft contains many controversial provisions that ACCA is monitoring, including a mandatory increase in building codes, granting DOE the authority to use multiple descriptors in energy efficiency standards, a carbon tax, and a phase down and cap and trade plan on HFCs.

The bill includes a provision that would mandate that building codes be updated with increases in building performance benchmarks so that by 2016 buildings will save 50% of the energy over ASHRAE 90.1-2004. If the benchmarks are not met, the DOE could set the standards themselves.

The provision on multiple descriptors would mean HVACR appliances may have to be rated on more than just AFUE or SEER. It would allow DOE to set a minimum efficiency standard on the fuel economy of an appliance, and then any other energy consuming device on the appliance.

The entire business community is concerned over how this draft bill would increase the costs of energy and fuel in the global warming pollution reduction program. It would be especially harmful to operations with vehicle fleets.

In the greenhouse gas title, the House discussion draft proposes to phase down the use of HFCs through 2050. The good news is that HFCs are treated differently than other emissive gases because they are a useful gas in demand by society. The bad news is that the next generation of safe, environmentally friendly and commercial available refrigerants has yet to be developed. As the wing walkers say, you never let go with one hand unless the other is holding on to something. A cap and trade program on HFC will almost certainly limit their supply and increase the price.

Meanwhile the US EPA has determined that greenhouse gases threaten public health and welfare because they contribute to climate change. The Supreme Court ruled in 2007 that the agency has the authority to regulate greenhouse gases such as carbone dioxide and HFCs as part of the Clean Air Act. The Agency can now develop regulations to limit the release of greenhouse gases into the atmosphere. It’s expected they will begin with automobiles and heavy vehicles.

Most likely the EPA will allow Capitol Hill and the Obama Administration to take the lead on developing a policy on regulating greenhouse gases. But if it looks like legislation may be killed, they will be ready to start the process on the regulatory side.