Washington DC's Ambitious Clean Energy Law Explained

A Changing Climate Means A Changing Society. The Island Press Urban Resilience Project, Supported By The Kresge Foundation And The JPB Foundation, Is Committed To A Greener, Fairer Future.​ This Article Was Originally Published May 8, 2019 On Greater Greater Washington as part of the Urbanist Journalism Fellowship.

In January 2019, the District passed the most ambitious clean energy legislation in the nation. However, local climate activists say the hard work is just beginning—they want to know who will lead the DC Green Bank and whether the law will benefit the least-privileged residents of the District.

March 22 marked the official beginning of Law L22-0257, also known as the Clean Energy Act DC. First introduced as the Clean Energy DC Omnibus Act of 2018 by Councilmember Mary Cheh (ward 3), the bill aimed to transition DC to run on 100% renewable electricity by 2032, making it the country’s most ambitious renewable electricity standard. The law also aims to reduce carbon emissions by 50% by 2032.

Now, almost four months after DC Mayor Muriel Bowser signed the bill into law, activists and experts say it's important to pay attention to how the law is implemented and funded. They say scrutiny is needed regarding equity and accountability, particularly with the DC Green Bank, which is the financial engine for the clean energy law. The Green Bank would manage loans to private developers looking to make their buildings more efficient, as well as loans to individual households looking to do the same. These “financial products” are just some of the services it could offer.

Bowser has announced four of the seven voting candidates for the Green Bank's authority board, and the rest are expected to be announced within the next few weeks. Committee hearings are currently being planned for late May, with confirmation in early June. Who gets on the board is important because board members will determine the direction of the program and make key decisions. Since equity is a big part of the Clean Energy Act, making sure board members instill equity and fairness is a top priority for many local activists.

The different parts of DC's green law work in concert

The Clean Energy Act DC is meant to be self-containing, Mark Rodeffer of the DC Sierra Club chapter says. This means that money for the various programs will come from the Sustainable Energy Utility and the DC Green Bank.

Here are the main parts of the Clean Energy Act DC, and how they fit together:

1. The Sustainable Energy Trust Fund (SETF): Under the new law, residents will be charged a fee for electricity and natural gas consumption. This fee, called the Sustainable Energy Utility (SEU), will go into the Sustainable Energy Trust Fund to pay for energy efficiency programs.

Thirty percent of the revenue earned through the SEU will be used to assist low-income residents with efficiency programs and projects like bill assistance, weatherization, and switching fuel. The fund will put aside $3 million each year to fund energy efficiency improvements in low-income housing buildings.

By 2025, $70 million will be added to the DC Green Bank to fund clean energy projects in the city and foster new development.

2. The Building Energy Performance Standard (BEPS): The DC Department of Energy and the Environment will asses private buildings to ensure energy efficiency every five years beginning in 2021.

By 2021, all DC-owned buildings of at least 10,000 square feet and private buildings of at least 50,000 square feet will need to be compliant with the standard or face a penalty and a timeline of five years to become compliant before receiving another penalty. The square footage threshold for privately-owned buildings decreases to 25,000 in 2023 and 10,000 in 2026. The BEPS and the SEU will be utilized by the Green Bank to incentivize and assist with affordable housing efficiency programs.

3. Transportation emissions: The law aims to electrify all public transportation vehicles, and it also establishes a fee for fuel as part of an initiative to reduce greenhouse gas emissions. By 2045, all privately-owned commercial transportation will be required to be 100% zero emissions.

An excise tax on private, non-commercial vehicles aims to incentivize people to purchase fuel-efficient vehicles. Though no funding has been set aside to buy more electric buses, the law’s budget apportions $250,000 for research into the implementation of greener transportation. The mayor’s budget proposal for Fiscal Year 2020 only specifies $3 million to install electric vehicle charging stations.

4. The Green Bank: The DC Green Bank is a key component of the law, and activists and environmentalists are keeping a close eye on how it's implemented. Green Banks are designed to be funded partially through private and public funds. By using public funds to leverage private investment through loans and financing, not grants, the District would be able to eliminate the upfront costs for energy efficiency projects, such as solar panels.

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