ENERGY STAR® and Other
              Climate Protection Partnerships
ENERGY STAR I   2007 Annual ReP°rt
                                         United States
                                         Environmental Protection
                                         Agency

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ENERGY STAR® AND OTHER CLIMATE PROTECTION  PARTNERSHIPS
2007 ANNUAL REPORT

CONTENTS
Letter from the Administrator	1
Executive Summary	2
     Highlights of 2007	2
     Looking Forward to 2008 and Beyond	4
Introduction to EPA's Climate Protection Programs 	8
Climate Leaders	12
ENERGY STAR Overview	14
     ENERGY STAR in the Residential Sector	18
     ENERGY STAR in the Commercial Sector	24
     ENERGY STAR in the Industrial Sector	30
Climate Choice 	34
Clean Energy Supply Programs	36
     Green Power Partnership 	36
     Combined Heat and Power Partnership	36
State and Local Programs and Initiatives	40
     Clean Energy-Environment State  Partnership	40
     Clean Energy-Environment Municipal Network	40
     Clean Energy and Utility Policy Programs	42
Methane Programs	44
     Natural Gas STAR Program	44
     AgSTAR Program	46
     Coalbed Methane Outreach Program	46
     Landfill Methane  Outreach Program	48
Fluorinated Gas Programs	50
Demonstrating Progress: Measuring  Results of the EPA Climate Protection Partnership Programs	56
List of Figures	62
List of Tables  	63
References	64

For additional information, please visit our Web sites at www.epa.gov/cppd, www.energystar.gov,
www.epa.gov/cppd/climatechoice, www.epa.gov/cleanenergy/stateandlocal/index.htm, www.epa.gov/methane,
and www.epa.gov/highgwp.
NOTE: The data source for all figures and tables in this 2007 Annual Report is EPA's Climate Protection Partnership Programs unless otherwise noted.
Historical totals have been updated based on the most recent available data.

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                                                                                   LETTER FROM THE ADMINISTRATOR
                                                                                                  October 2008

               I am pleased to present this report on the accomplishments of the U.S. Environmental Protection
               Agency's climate protection programs. Through these partnerships, EPA has provided tools, resources,
               and guidance to thousands of organizations nationwide during the past 15 years to reduce greenhouse
               gas emissions by investing in energy efficiency and clean energy. Together, we made 2007 our most
               successful year to date and made significant progress toward reaching the President's goal to improve
               greenhouse gas intensity by 18 percent by 2012.

               Increasing the use of energy-efficient products and practices is a critical strategy in the fight against
               global warming. This year EPA offered more energy efficiency solutions to a wider audience than ever
               through the ENERGY STAR program—with impressive results. In 2007 alone, Americans, with the help of
               ENERGY STAR, saved more than $16 billion on their utility bills while preventing greenhouse gas
               emissions equivalent to those from 27 million vehicles.

               EPA is also actively involved in increasing the supply of clean energy resources. The Fortune 500 partners
               of the Green Power Partnership responded successfully to EPA's challenge  to double their purchases of
               green electricity in 2007 by purchasing more than 6.5 billion kWh and contributing more than half of the
               11.5 billion kWh purchased by all partners last year. The  more than 200 partners of the Combined Heat
               and Power Partnership have installed over 4,450 MW of  new combined heat and power capacity.

               In 2007, EPA's partners  used EPA tools and resources to  avoid emissions of  methane and fluorinated
               gases equivalent to those from more than 20 million vehicles. As a result, emissions of these gases
               remain significantly below 1990 levels.

               Corporations, utilities, and state and local governments are capitalizing on the multiple benefits of energy
               efficiency, clean energy, and other strategies to reduce greenhouse gas emissions. EPA's corporate
               commitment program,  Climate Leaders, grew nearly 50 percent to 155 partners in 2007. EPA also provided
               support to utilities and  state and local governments as they develop and implement the energy efficiency
               and clean energy policies that can reduce greenhouse gas emissions.

               The success of ENERGY STAR and EPA's other partnership programs proves that proactive climate
               protection efforts can be part of successful  business strategies. Together with our partners, EPA looks
               forward to even greater results in 2008!
                                                                      Stephen L Johnson
                                                                      Administrator
                                                                      U.S. Environmental Protection Agency
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report

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EXECUTIVE  SUMMARY
     Global climate change has emerged as one of the most
     serious environmental problems facing the United States
     today. Combined with rising energy prices, increased
     volatility in energy markets, and growing concerns about
     national energy security, the need to capitalize on proven,
     cost-effective opportunities to reduce  greenhouse gas
     emissions in the energy sector has never been greater. In
     2007, the U.S. Environmental Protection Agency's (EPA's)
     climate protection partnership programs significantly
     reduced the emissions of greenhouse  gases that
     contribute to global climate change by breaking down
     the identifiable market barriers that limit investments in
     energy efficiency, clean energy supply, and other climate-
     friendly technologies and practices.

     Through EPA's suite of well-designed partnerships, more
     than 14,000 organizations nationwide have  invested in
     protecting the environment and made  significant progress
     toward the President's greenhouse gas intensity reduction
     goal for 20121 (see Table 1 and Figure 1).

     The measures adopted by EPA's partners through 2007
     have resulted in the following major environmental and
     economic benefits:

     • Prevention of 78 million metric tons  (in MMTCE2) of
       greenhouse gases, equivalent to the emissions from
       52 million vehicles, and net savings  to consumers and
       businesses of $17 billion in 2007 alone.
     • Prevention of more than 1,000 MMTCE and  net savings
       to consumers and businesses of about $200 billion over
       the  lifetime of their investments.
     • Investment of more than $55 billion in energy-efficient,
       climate-friendly technologies.


     Highlights of 2007
     • Climate Leaders, the Administration's corporate
       leadership program, grew nearly 50 percent in 2007
       for a total  of 155 partners. Seven partner companies
       announced that they had achieved greenhouse gas
 reduction goals set through Climate Leaders. More
 than half of the partners have announced aggressive
 targets for the future. Together, these goals represent
 a potential reduction in greenhouse gas emissions
 of more than 13 MMTCE (see p. 12) over business-as-
 usual outcomes.
1 Through the ENERGY STAR program in 2007, EPA helped
 Americans save 180 billion kilowatt-hours (kWh)—about
 5 percent of U.S. electricity demand—prevent the
 emissions of 40 MMTCE of greenhouse gases, and save
 $16 billion on their energy bills (see Figure 2). Other
 ENERGY STAR program highlights include:
 Offering More Qualified Products to More Consumers
   More than 2,000 manufacturers are using the
   ENERGY STAR label on over 40,000 individual product
   models across 50 product categories.
   Americans purchased about 500 million ENERGY
   STAR qualified products in 2007, bringing the total to
   more than 2.5 billion since 1992.
   EPA expanded the suite of ENERGY STAR qualified
   products to include digital-to-analog  converter
   boxes (DTAs), decorative light strings, and
   commercial dishwashers and ice machines, and
   completed important revisions to the specifications
   for residential light fixtures and roofing products.
 Raising the Bar for New Home Construction
   Despite the downturn in the new housing market,
   more than 120,000 new homes were constructed
   to meet ENERGY STAR guidelines in 2007, which
   represents about 12 percent of the U.S. new housing
   starts in 2007 and brings the total to almost
   840,000 qualified homes nationwide.
 Improving the Comfort and Efficiency of Existing Homes
 • More than 38,000 homeowners are enjoying greater
   savings and comfort in their homes thanks to state
   and locally sponsored Home Performance with
   ENERGY STAR programs. Seven  sponsors launched
   new programs in 2007, bringing the total to more than
   20 programs in 21 states.
      Greenhouse gas intensity is the ratio of greenhouse gas emissions to economic output (measured by the gross domestic product). EPA's climate
      programs are expected to contribute about 70 percent of the emissions reductions needed to achieve the President's goal of an 18 percent
      reduction in greenhouse gas intensity by 2012. For more information on the Administration's goal, see
      http://www.whitehouse.gov/news/releases/2002/02/climatechange.html
      Million metric tons of carbon equivalent (MMTCE). Reductions in annual greenhouse gas emissions for EPA's climate programs are based on
      "carbon equivalents," which are determined by weighting the reductions in emissions of a gas by its global warming potential for a
      100-year time period.

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                                                                                                              EXECUTIVE SUMMARY
        TABLE 1. Annual and cumulative benefits from partner actions through 2007
        (in billions of 2007 dollars and MMTCE)

Program
ENERGY STAR Total
Qualified Products and Homes
Buildings
Industry
Clean Energy Supply Programs
Methane Programs
Fluorinated Gas Programs
TOTAL
BENEFITS
Net Savings
(Billion $)

$8.8
$5.4
$2.1
—
$0.5
—
$16.7

Emissions
Avoided
(MMTCE)
42.4
18.1
18.0
6.3
4.8
17.4
13.8
78.4
PV of Bill
Savings
(Billion $)
$244.5
$118.9
$99.6
$26.0
—
$10.1
—
$254.7
CUMULATIVE BENEFITS 1993 - 2017
PV of Technology
Expenditures
(Billion $)

$15.1
$32.7
$5.3
na
$4.0
na
$57.1
PV of Net
Savings
(Billion $)
$191.4
$103.8
$66.9
$20.7
—
$6.1
—
$197.5
Emissions
Avoided
(MMTCE)

233
214
90
63
229
243
1,070
        PV:      Present Value
        NOTES:    Technology Expenditures include O&M expenses for Methane Programs. Bill Sa vings and Net Sa vings include revenue from sales of methane and electricity.
                 Totals may not equal sum of components due to independent rounding. For details on cumulative benefits, see page 56.
        	.-     Not applicable
        na:      Not available
        FIGURE 1. Greenhouse gas emissions reductions exceed 75 MMTCE—Equivalent to emissions from 52 million vehicles
           tn
           en
                   2000
          2001
2002
2003
2004
2005
2006
2007
I                                                                                              TOTAL FLUORINATED
                                                                                              GAS SAVINGS

                                                                                             | TOTAL CH4 SAVINGS

                                                                                             | TOTAL C02 SAVINGS
        FIGURE 2. ENERGY STAR benefits continue to grow
                                                             16
                                                 14
                                                       15
                                           12
                              10   PT_T*
I     I
I     I
                                        i           i
                                        i           i
                                        i           i
                 2000   2001   2002   2003   2004   2005  2006  2007
                UTILITY BILL SAVINGS (in billions)
                                                                               10
                                                                                     12
                                                                                                                    -24-
                                                                                                               22
                                                                                                  16
                                                                                                                           27
                                                                I     I     I

                                                   I           III

                                                   I           III
                                                         2000   2001   2002   2003   2004   2005   2006   2007
                                                        EMISSIONS SAVED INVEHICLE EQUIVALENTS (in millions)
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report

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  Saving Energy in the Commercial and Industrial Sectors
  • Almost 800 organizations and individuals nationwide
    have joined the ENERGY STAR Challenge to improve
    the energy efficiency of their commercial buildings by
    10 percenter more.
  • Use of EPA's energy performance rating system
    experienced tremendous growth; building owners
    and operators used the system to rate the
    performance of more than  62,000 buildings—
    doubling the number of buildings rated in just one
    year and representing more than 7.5 billion square
    feet of building space.
  • More buildings than ever have qualified for the
    ENERGY STAR, over 4,000,  representing more than
    740 million square feet. These buildings use nearly 40
    percent less energy than typical buildings.
  • Almost 40 auto assembly, corn refining, cement—and
    for the first time, petroleum refining—facilities in the
    United States have earned  the ENERGY STAR for
    superior energy performance.

• More than 1,000 partners in EPA's Clean Energy Supply
  programs, which include the Green Power Partnership
  and Combined Heat and Power (CHP) Partnership,
  purchased more than 11 billion kWh of green power
  in 2007. Collectively, they have installed more than
  4,450 megawatts (MW) of new, environmentally
  beneficial CHP  capacity.
• EPA enhanced its efforts to assist state and local
  governments in their pursuit  of clean energy policies
  by expanding its state partnership and municipal
  network to include 15 states  and hundreds of local
  governments.
• The EPA- and U.S.  Department of Energy (DOE)-
  facilitated National Action Plan for Energy Efficiency
  (Action Plan) released Vision for 2025: Developing a
  Framework for Change, which offers a framework of
  state-specific policies and programs to enable the
  acquisition of all cost-effective energy efficiency
  measures by 2025. Across 49 states, 120 organizations
  have made commitments to advance energy efficiency
  through the Action Plan.
• The methane (CH4) programs continued to reduce
  emissions of this potent greenhouse gas from landfills,
  agriculture, natural gas systems, and coal mines.  In
  2007, these programs avoided more than 17 MMTCE of
  greenhouse gas emissions, exceeding their emissions
  reductions goals and maintaining national methane
  emissions 11 percent below  1990 levels.
• The partnerships that focus on fluorinated gases
  (F-gases) kept national emissions of these gases from
  industrial sources over 55 percent below 1990 levels.
  Further, EPA has made important progress in the effort
  to reduce emissions related to vehicle air conditioners.
  Collectively, these programs avoided more than
  13 MMTCE of greenhouse gas emissions in 2007.
• In 2007, EPA recognized the  accomplishments of
  outstanding partners in the voluntary partnership
  programs described above. In addition, EPA's International
  Climate Protection Awards honored forward-thinking
  individuals, companies, and  organizations for their
  leadership and achievements (see  Figure 4, p. 7).


Looking  Forward to 2008 and Beyond
EPA continually refines and expands  its climate protection
programs to increase the environmental benefits. As a
result, the benefits from these partnership  programs have
more than doubled since 2000 and are on trackto double
again within 10 years, while meeting  aggressive interim
goals (see Table 3 and Figure 3, p. 7).  Key steps EPA will
take in 2008 and beyond to reach those goals are
outlined below.

Climate Leaders. In 2008, EPA will engage more
organizations  in understanding their carbon risks and
reducing their carbon footprint by helping them accurately
inventory their greenhouse gas emissions, set aggressive
reduction goals, and report on progress. EPA expects to
welcome 35 new partners into Climate Leaders and have
25 existing partners announce reduction targets. In
addition, EPA will incorporate the tenets of Climate Leaders
program protocols and lessons from partner reporting
experiences into the development of future climate policy.

ENERGY STAR. A growing body of evidence
demonstrates that efforts such as ENERGY STAR are
critical to addressing climate change. The  greenhouse
gas and energy bill savings from the ENERGY STAR program
in 2007 were 15 percent greater than  those of the prior
year and more than double the savings in 2000 (see
Table 2). In 2008 and beyond, EPA will continue to build
the ENERGY STAR  program as a credible guide for
investing in energy efficiency for consumers, businesses,
and other organizations to leverage as  part of their own
efficiency and greenhouse gas reduction efforts. EPA will
also maintain the integrity and build the value of the
ENERGY STAR program.

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                                                                                                                      EXECUTIVE SUMMARY
         TABLE 2. ENERGY STAR key program indicators, 2000 and 2007
ENERGY STAR
PROGRAM STRATEGY
Efficient Products
(for more information, see p. 14)
Home Improvement
(for more information, see p. 20)
New Homes
(for more information, see p. 22)
Existing Commercial Buildings
(for more information, see p. 24)
New Commercial Buildings
(for more information, see p. 28)
Industrial Improvements
(for more information, see p. 30)
Annual Results
(for more information, see p. 14)
KEY INDICATOR
Product Categories Eligible forthe ENERGY STAR
Individual Product Models Qualified
Products Sold
Public Awareness
Manufacturing Partners
Retail Partners
EE Program Administrator Partners
Homes Improved through
Home Performance with ENERGY STAR1
EE Program Administrator Partners
Homes Benchmarked using Yardstick
Number of New Homes Built1
Percent of National New Home Starts
States and Metro Areas with over 20% Market Share
Builder Partners
Number of Buildings Rated1
Building Square Footage Rated1
Percent of Commercial Square Footage Rated
Building Types Eligible for the ENERGY STAR Label
Number of Buildings Labeled1
Building Square Footage Labeled
Number of Labeled Buildings Using 50% Less Energy
Number of Buildings Achieving Designed to Earn
the ENERGY STAR
Industrial Partners
Industrial Sectors (and subsectors)
Facility Types Eligible for the ENERGY STAR Label
Number of Facilities Labeled
Energy Saved (kWh)
Emissions Avoided (MMTCE)
Net Savings (USD)
YEAR
33
11,000
600 million
40%
1,600
550
100

--
--
25,000
<1%
0
1,600
4,200
800 million
1%
2
545
128 million
--

--
0
--
-
62 billion
15.8
$5 billion
OF RESULTS
2007
>50
>40,000
>2.5 billion
>70%
>2,000
>1,000
>550
~ 40,000
>20
>95,000
~ 840,000
~ 12%
39
>5,000
>62,000
>7.5 billion
~ 10%
11
>4,000
>740 million
-500
35
-480
12
4
37
180 billion
>40
$16 billion
         'Results are cumulative. '•The cumulative total of product sales across the entire ENERGY STAR program, including those from the efforts of the U.S. Department of Energy. The results for
         energy sa ved and the resulting environmental and economic benefits represent EPA efforts alone.
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report

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Key 2008 milestones for the ENERGY STAR program include:
• Expanding the ENERGY STAR label to new product
  categories when the core program principles of
  cost-effectiveness and maintenance of product
  performance can be met. EPA will revise the
  requirements for products already in the program as
  conditions warrant. In 2008, EPA expects to finalize
  revised specifications for TVs, set-top boxes, external
  power adapters, computers, imaging equipment,
  commercial food-grade refrigerators, and furnaces.
  EPA will also continue to work with its vast network of
  partners to encourage consumers and businesses to
  choose ENERGY STAR qualified  products. Overall, EPA
  expects more than 300 million ENERGY STAR qualified
  products to be sold each year for the foreseeable future.
• Partnering with more home builders  and  other
  organizations in the industry to construct more than
  100,000 new ENERGY STAR  qualified homes and bring
  them to more markets throughout the country.
  Additionally, EPA will evaluate pilots for a Multi-Family
  High Rise Program and explore the next generation of
  ENERGY STAR specifications for new homes through
  EPA's Climate Choice program.
• Expanding Home Performance with ENERGY STAR by
  launching the program in four new markets and having
  more than 15,000 homes retrofitted in 2008, bringing the
  national total to over 50,000 homes made more efficient.
• Intensifying building efficiency efforts across the
  commercial buildings sector through the ENERGY
  STAR Challenge and other activities. EPA will continue
  to partner with  states, trade associations, and others
  to engage, train, and facilitate building improvements.
  Strategies include advancing effective energy
  management as a core business strategy, as well as
  promoting standardized measurement systems for
  assessing the efficiency of these facilities, targeting
  improvements, and tracking  progress over time.
• Building on the progress made to date in the industrial
  sector, which includes finalizing two industrial energy
  performance indicators (EPIs) and expanding the
  system for labeling to certain food processing and
  glass manufacturing plants  in 2008. EPA expects to
  expand its work to more industrial partners and add
  two additional Industrial Focus sectors each year.
• Providing recognition to partners who have demonstrated
  outstanding leadership across the residential,
  commercial, and industrial sectors through the ENERGY
  STAR Partner of the Year Awards and other efforts.

Clean Energy Supply Programs. In 2008, EPA
will continue to help partners improve the supply of the
nation's clean energy  resources. The Green Power
Partnership will support the purchase of more than
16 billion kWh of green power by extending the highly
successful Fortune 500 Challenge into a second year.
The CHP Partnership will assist in identifying and
developing new CHP projects with special emphasis
on the dry mill ethanol sector, wastewater treatment
facilities, and casinos and hotels.

State and Local  Government Clean Energy
Programs. EPA will  continue to assist state and local
officials in their quest to develop and implement clean
energy strategies through its state partnership, municipal
network, and utility policy programs. In 2008, EPA plans to
add one new partner to the  state partnership, share best
policy practices, expand the municipal network, and
provide support to communities addressing urban heat
island effects. In its role as co-facilitator of the Action
Plan, EPA will focus on increasing outreach and
education, and developing additional resources to help
utilities and other stakeholders fully capture the benefits of
energy efficiency.

Methane and Fluorinated Gas Programs.
National methane emissions and  F-gas emissions are
currently below 1990 baselines3 and are expected to stay
that way into the future because of EPA's partnership
programs, such as the Landfill Methane Outreach
Program, the Natural Gas STAR Program, and a suite of
programs addressing the F-gases. In 2008, EPA will strive
for further achievements in these programs by:

• Working aggressively with existing  and new partner
  companies to develop more methane emissions
  reduction projects and maintain overall methane
  emissions  below 1990 levels.
• Partnering with  companies in the aluminum, magnesium,
  semiconductor, utility, HCFC-22, and mobile air
  conditioning sectors to reduce emissions of F-gases.
• Continuing to spread the success of EPA's domestic
  methane partnership programs overseas through the
  Methane to Markets Partnership.
 Emissions do not include those used in mobile air conditioning or as replacements for ozone depleting substances.

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                                                                                                           EXECUTIVE SUMMARY
        TABLE 3. Long-term greenhouse gas reduction goals for EPA Climate Partnership Programs (MMTCE)
PROGRAM

ENERGY STAR*
Clean Energy Supply Programs
Methane Programs
Fluorinated Gas Programs
TOTAL
ACCOMPLISHMENTS

42.4
4.8
17.4
13.8
78.4

2012
52
8
18
19
97

64
12
20
22
118
        "Does not include ENERGY STAR products managed by DOE.
        FIGURE 3. Potential for additional greenhouse gas reductions from EPA Climate Partnership Programs


                    1996       1998
                   YEARS 1995-2017
2000
2002
2004
2006
2008
2010
2012
2014
2016 2017
        NOTE: Historical totals updated based on most recent data available.
        FIGURE 4. International Climate Protection Awards
                                EPA established the
                                Climate Protection
                                Awards in 1998 to
                                recognize outstanding
                                accomplishments in
                                protecting the Earth's
                                climate. So far,
                                154 individuals,
           companies, and organizations from 18 countries
           have earned the EPA Climate Protection Award.
           This year's 15 winners are from Argentina,
           Costa Rica, India, and the United States. They
           are reducing greenhouse gas emissions by
           improving energy efficiency, introducing new
           technologies, purchasing green power, and
           inspiring local and global action to protect the
           climate. Each winner serves as an example and
           inspiration for others to take action to protect
           the climate.
                  CORPORATE AND GOVERNMENT
                  AWARD WINNERS
                  Advanced Micro Devices
                  Sunnydale, CA
                  Austin Energy
                  Austin, TX
                  City of Albuquerque
                  Albuquerque, NM
                  Xerox Corporation
                  Norwalk, CT
                  MEGTEC Systems
                  De Pere, Wl

                  TEAM AWARD WINNERS
                  Climate Protection Team of Mr.
                  Durwood Zaelke & Mr. Scott Stone
                  Washington, DC
                  Life Cycle Analysis Team of Dr. Stella
                  Papasavva& Mr. William R. Hill
                  Warren, Ml
                                              INDIVIDUAL AWARD WINNERS
                                              Ms. Gay Browne
                                              Montecito, CA
                                              Mr. John Morrill
                                              Arlington, VA
                                              Mr. Kenneth Davis
                                              Warren Air Force Base, WY
                                              Ms. Laura Miller
                                              Dallas, TX
                                              Ms. Laurie David
                                              Pacific Palisades, CA
                                              Mr. Marco Gonzalez
                                              Costa Rica
                                              Ms. Romina Picolotti
                                              Buenos Aires, Argentina

                                              LIFETIME ACHIEVEMENT AWARD
                                              Dr. Rajendra K. Pachauri
                                              New Delhi, India
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report

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INTRODUCTION  TO  ERA'S  CLIMATE  PROTECTION  PROGRAMS
     In the United States, there is enormous potential to cost-
     effectively reduce greenhouse gas emissions; however,
     pervasive market barriers have long discouraged some
     consumers and organizations from taking advantage of
     these "win-win" opportunities. For the past 15 years, the
     U.S. Environmental Protection Agency's (EPA's) voluntary
     climate protection programs have helped break down the
     barriers that can stifle cost-effective investment in  energy
     efficiency, clean energy, and other climate-friendly
     technologies and practices (see Table 4, p. 11). EPA's
     public-private partnerships provide a suite of tools,
     resources, practices, and policies for thousands of
     partners, who count on and benefit from—

     • Objective information
     • Technical assistance
     • Recognition for environmental leadership

     Through these partnerships, U.S. consumers, businesses,
     and organizations  are stepping up to the nation's
     challenge and taking action to reduce their energy use,
     avoid greenhouse  gas emissions, and  hedge against
     volatile fuel markets. Their actions result in real financial
     and environmental benefits across the residential,
     commercial, and industrial sectors, which increase every
     year as the number of partners and variety of tools and
     strategies offered  through EPA's programs continue to
     grow. The impressive level of benefits achieved in 2007 is
     expected to double by 2017, making EPA's suite of climate
     protection programs an important component of the
     President's plan to reduce greenhouse gas intensity
     18 percent by 2012.

     The programs summarized in this report4 focus on the
     broad strategies described below to achieve their
     environmental goals:


     Corporate Commitments To  Reduce
     Greenhouse Gas Emissions
     CLIMATE
     U.S. Environmental Protection Agency
Partners in EPA's Climate
Leaders program are
Fortune 500 and other
leading corporations that
                              ENERGYSTAR
have committed to aggressively reducing their
greenhouse gas (GHG) emissions. When they join the
partnership, these companies agree to complete a
comprehensive inventory of their greenhouse gas
emissions, set an ambitious long-term reduction goal, and
annually report their progress to EPA. Climate Leaders are
reducing their carbon footprint and earning recognition for
environmental stewardship through the program by
investing in energy efficiency, clean energy, and
measures to reduce emissions of other greenhouse gases.


Energy Efficiency
                   Energy efficiency—obtaining
                   identical services or output (such as
                   heating, cooling, and lighting) with
                   less energy input—offers one of the
                   lowest cost means of reducing
                   energy bills and addressing climate
change (see Figure 5). Since 1992, EPA has helped
individuals and organizations nationwide adopt cost-
effective, energy-efficient technologies and practices and
save up to 30 percent on their energy bills by:

• Clearly identifying energy-efficient products with
  superior performance in the market place.
• Improving the energy efficiency standards of new
  home construction and existing home renovations.
• Promoting strategic energy management practices
  across the commercial and industrial  sectors so that
  businesses and organizations can proactively manage
  their energy use (see Figure 6, p. 11).
• Developing new efforts to accelerate the adoption of
  emerging greenhouse gas-reducing technologies.


Expansion of Clean Energy Supply
       *-EPA          In 2001, EPA launched two
                     partnership programs in
                     fulfillment of the National Energy
                     Policy—the Green Power
                     Partnership and the Combined
                     Heat and Power (CHP)
Partnership—to increase the nation's supply of clean
 GREEN
 POWER
 PARTNERSHIP
CHP
                                                           &EPA COMBINED HEAT AND
                                                                 POWER PARTNERSHIP
      This report provides results for the Climate Protection Partnership Programs operated by the Office of Atmospheric Programs at EPA. It does not
      include emissions reductions attributable to WasteWise, transportation programs, the Significant New Alternatives Program, or the landfill rule,
      which are the remaining actions in EPA's comprehensive climate program. EPA estimates that the reduction in greenhouse gas emissions across
      the entire set of climate programs to be about 110 million metric tons of carbon equivalent (MMTCE) in 2007.

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                                                                                                                                 INTRODUCTION
         FIGURE 5. Two new reports highlight the critical role of energy efficiency and clean energy as low-cost
         opportunities for greenhouse gas emissions reductions
            As the effects of climate change continue to manifest themselves in the
            United States and abroad, the demand is growing for near-term, low-
            cost solutions across all sectors of the economy. In 2007, two new
            important reports were published that highlight the substantial
            opportunities for low-cost greenhouse gas emissions reductions
            through energy efficiency and clean energy. These reports join a
            growing body of research that conclude that ENERGY STAR and
            EPAs other climate protection programs are delivering low-cost, near-
            term solutions to address climate change.
            The Intergovernmental Panel on  Climate  Change (IPCC) Fourth
            Assessment Report: Working Group III, approved in May 2007, presents
            a comprehensive update on global greenhouse gas mitigation
            opportunities and reaches the following conclusions:
            * Globally, the residential and commercial sectors have the potential
              to reduce approximately 29 percent of the projected baseline
              emissions by 2020 at negative cost—the highest potential
              improvement among all sectors studied in the report.
            * Sound policy combined with strong enforcement is necessary to
              overcome the substantial barriers that exist, especially in the
              residential and commercial sectors, to achieve these improvements.
            * Substantial reductions in carbon dioxide (CO^) emissions from
              energy use in buildings can be  achieved over the coming years using
              mature technologies for energy efficiency that already exist widely
              and that have been successfully used.
                            In December 2007, the management consulting firm McKinsey &
                            Company released its report Reducing U.S. Greenhouse Gas Emissions:
                            How Much at What Cost?, which concludes.
                            * By 2030, the United States has the potential to reduce greenhouse
                              gas emissions by  3.0 to 4.5 gigatons of CO2 equivalent using low-
                              cost abatement options—available at marginal costs of less than
                              $50 per ton if the nation can capture sizable gains from energy
                              efficiency and clean energy.
                            * Prompt action and a strong, coordinated, economy-wide
                              implementation strategy is necessary in the near future  to reduce
                              greenhouse gas emissions at the lowest cost to the economy.
                            * Energy efficiency in buildings and appliances has the potential to
                              reduce greenhouse gas emissions by 710 — 870 megatons through
                              options including lighting retrofits, office electronics, appliances,
                              and improved heating, ventilation, and air conditioning systems
                              (see figure below).
                            * Almost 40 percent  of targeted reductions, primarily improvements
                              in energy efficiency in buildings, could be achieved at negative costs,
                              which could substantially offset the cost of other higher cost abatement
                              options, although it requires some funding to capture these opportunities.
                            * These savings could only be realized by overcoming persistent
                              barriers to market efficiency, including mismatches between who
                              pays the cost of an  option and who gains the benefit, lack of
                              information about  the impact of individual decisions, and consumer
                              desire for rapid payback (typically 2 to 3 years) when incremental up-
                              front investment is required.
            U.S. potential for greenhouse gas emissions reductions through
            energy efficiency and clean energy
                                                               Commercial Buildings
                                                               HVAC Equipment
                                                               Efficiency
                                                                     Offshore
                                                                     Wind
                                                                                 Natural
                                                                                 Gas and
                                                                                 Petroleum
                                                                                 Systems
                                                                          Onshore  Management
                                                                          Wind
                                                                          Low
                                                                          Penetration
Residential
Buildings    \Commercial
NewShell     Buildings
Improvements   New Shell
                                                                                                                    REDUCTION POTENTIAL IN
                                                                                                                            MMTCE PER YEAR
                                                                                                       Energy Efficiency
                                                                                                       Clean Energy/Other
                                           L'aM"g Commercial Buildings
                                                 Fluorescent Lighting
          1
           For more information, see Intergovernmental Panel on Climate Change (IPCCI, 2007.
          • For more information, see McKinsey & Company, 2007.
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report

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           Clean EnergyEnvironment
           STATE PARTNERSHIP
           Clean EnergyEnvlronment
           MUNICIPAL NETWORK
National
Action
Plan for
Energy
Efficiency
energy (see Figure 7). These partnerships are spurring
resource growth by promoting greater purchase of
electricity derived from renewable sources and greater
investment in environmentally friendly combined heat and
power. EPA has partnered with hundreds of organizations
through these two programs to provide technical
assistance, minimize transaction costs, and promote
technologies that significantly reduce greenhouse gas
emissions from energy generation.


State  and Local Energy Policy Evolution
                                Significant
                                informational and
                                institutional barriers
                                can prevent state
                                and local entities
                                from implementing
                                policies and making
                                investments that spur
                                development in
energy efficiency and clean energy. Through the Clean
Energy-Environment State Partnership and the Clean
Energy-Environment Municipal Network, EPA provides
state and local energy policymakers with tools and
resources that allow them to explore, evaluate, and
implement a variety of clean energy policies. EPA is also
facilitating the National Action Plan for Energy Efficiency
(Action Plan) along with DOE. In addition to other EPA
utility policy efforts, the Action Plan builds awareness of
and provides guidance on how to overcome state policies
that limit greater investment in energy efficiency by
utilities and other third-party administrators of energy
efficiency programs.


Non-C02 Greenhouse Gas Emissions
Reductions
A number of greenhouse gases can trap more heat in the
earth's atmosphere, on a per molecule basis, than carbon
dioxide (C02). Many of these gases are released as
byproducts of industrial operations. EPA's climate
partnerships are significantly reducing emissions of these
gases, as described  below:
                                                                   • Methane is both a potent greenhouse gas and a highly
                                                                     desirable clean fuel. EPA partners with the natural gas,
                                                                     coal mining, agriculture, and landfill gas development
                                                                     industries to help them capture methane in a cost-
                                                                     effective manner and use it or sell it as a clean energy
                                                                     source.
                                                                   • Many of the fluorinated gases (F-gases)—including
                                                                     hydrofluorocarbons (MFCs), perfluorocarbons (PFCs),
                                                                     and sulfur  hexafluoride (SF6)—are extremely powerful
                                                                     and persistent greenhouse gases. To avoid significant
                                                                     accumulation of these gases in  the atmosphere, EPA is
                                                                     collaborating with the aluminum, magnesium, and
                                                                     semiconductor industries; the HCFC-22 industries; the
                                                                     electric utilities; and those companies engaged in the
                                                                     mobile air-conditioning industry.
                                                                     Sft Emission Reduction
                                                                     Partnership forthe Magnesium Indusftv
                                        *'
                                                                                 "%

                                                                                                IMM MKIAl. I'AKTNr.KSHII'
                                                                   The 2007 Annual Report
                                                                   This annual report for 2007 provides detailed information
                                                                   on EPA's efforts within each of the five strategies
                                                                   mentioned above. The individual program sections that
                                                                   follow this introduction include an overview and
                                                                   accomplishments, environmental and economic benefits
                                                                   achieved in 2007, goals for the future, and summaries of
                                                                   the major tools and resources offered by the program.
                                                                   EPA is committed to documenting  quantifiable program
                                                                   results and using well-established methods to estimate
                                                                   the benefits of its climate partnership programs. Specific
                                                                   approaches vary by program strategy, sector, availability
                                                                   of data, and market characteristics (these methods are
                                                                   reviewed in the final section of the report, page 56). For
                                                                   each program, EPA addresses common issues that arise
                                                                   when estimating program benefits, such as data quality,
                                                                   double counting, free-ridership, external promotion by
                                                                   third parties, and market effects, among others. The
                                                                   information presented in this annual report is similar to
                                                                   much of the information used  in the U.S.  Office of
                                                                   Management and Budget (OMB) Program Assessment
                                                                   Rating Tool (PART), which found these EPA programs to
                                                                   be achieving their goals.
10

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                                                                                                                     INTRODUCTION
        TABLE 4. Market barriers addressed by EPA's Climate Partnership Programs
             AUDIENCE
             OR TARGET
             MARKET
                                                                                   CLIMATE PROTECTION PARTNERSHIP PROGRAM
  MARKET BARRIERS
  ADDRESSED
                                                                         T3
                                                                          CD
                                                                          03
                                                                         CJ
EC


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cc
o

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E a £ = "
O 03  CD J2 t
CJ I Z Q- LLJ
                                                                                        w
                                                                                        ca
                                                                                                                          S
                                                                                                                          «
                                                                                                       >.
                                                                                                       o
03   03 " t  03 £ —
•S   c E J5  c E jo
3  LU C n_  LLJ C B-
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=  J2 c *2  — c =
LL.  U LLJ CO  CJ LLJ ^
             Energy
             Consumers
  Lack of information about energy efficiency
  and renewable energy options
                            Competing claims in the marketplace

                            Lack of objective measurement tools

                            High transaction costs

                            Lack of reliable technical assistance

                            Split incentives

                            Perceptions of organizational risks
                            Lack of objective basis for recognition of
                            environmental stewardship
             Utilities
  Assessing objective measurement tools
                            Lack of information about energy efficiency
                            program costs and benefits

                            Disincentives for energy efficiency in existing
                            regulations and energy planning processes
             Industries with
             Byproduct GHG
             Emissions*
  Lack of reliable technical assistance

  Lack of objective basis for recognition of
  environmental stewardship
             State and
             Local Policy
             and
             Decisionmakers
  Lack of information about
  clean energy policies
  Lack of reliable technical assistance
                            Lack of objective basis for recognition of
                            environmental stewardship
         "Includes utilities
         FIGURE 6. U.S. C02 emissions by sector and
         non-C02 gases by percent of total GHGs
                                                     FIGURE 7. U.S. electricity generation by fuel type
               Methane
              Emissions
                 8.4%
        Agriculture
           1.6%


          Commercial
             14.5%
                                 Other non-CCh Gases
                                         7.4%
^"^     \  Industry
 Residential!   24 8%
   166%
                                 I Other Gases
                                                                           Other Renewables
                                                                                 2.4%
                                                                      Petroleum
                                                                        1.6%
        Hydroelectric
         Conventional
             7.0%


' Includes wind, photovoltaic
 energy, solar thermal,
 geothermal, landfill gas,
 agricultural byproducts, wood,
 and other renewable sources.
                  Natural Gas
                    20.0%
                                        Other
                                        0.7%
         Source; EPA 2007
                                                                               Source: EIA 2007
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                                                                          11

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     CLIMATE LEADERS
           CLIMATE*
                          EPA launched the Climate
                          Leaders program in 2002 to
U.S. Environmental Protection Agency  3SSiSt 163 dinQ COmpanieS
across the country in developing comprehensive climate
change strategies. Marking its fifth anniversary in
February 2007, Climate Leaders achieved a number of
significant milestones through the end of the year (see
Tables).

The number of Climate Leaders partners continued to
grow in 2007. They represent a broad range of industry
sectors, including cement, forest products, Pharmaceuticals,
utilities,  information technology, and retail (see  Figure 8).
Partners operate in all 50 states and provide nearly
7 million jobs worldwide. When joining the Climate
Leaders partnership, companies make a commitment to
reduce their impact on the global environment by
completing a corporate-wide inventory of their
greenhouse gas emissions based on a quality
management system, setting aggressive reduction goals,
and annually reporting their progress to EPA.

EPA provides valuable guidance and recognition to
partner companies as they develop  and  work toward their
emissions reduction goals. Using EPA's wide range of
tools, expertise, and resources, partners can make informed
decisions about cost-effective strategies, investments,
and projects in the areas of energy efficiency, clean
energy, and non-carbon dioxide (C02) emissions
reductions. EPA continuously tracks partner progress
through  a variety of means and ensures the credibility of
reported data by performing detailed reviews and making
site visits.


Achievements in  2007
• The number of Climate Leaders partners  grew to
  155, an increase of nearly 50 percent in just one year,
  with the addition of 50 new corporate  partners. These
  companies represent more than 8 percent of total
  U.S. greenhouse gas (GHG) emissions.
• Seven additional partners successfully acheived their
  initial Climate Leaders GHG reduction  goals: Advanced
  Micro  Devices, Caterpillar, Hasbro, Pfizer, Roche Group
  U.S. Affiliates, Sun Microsystems, and Xerox
  Corporation (see Table 6). Of the 15 companies that have
  met their initial goals in the program, 12 have committed
  to a second round of reduction goals.
• The total number of partners that have announced
  corporate GHG goals through 2007 grew to 80;
  22 partners announced goals in 2007 alone. More than
  half of the companies in the partnership have publicly
  announced GHG goals.
• EPA estimates that GHG reductions by the Climate
  Leaders partners will prevent 13 million metric tons of
  carbon equivalent (MMTCE) per year relative to
  business-as-usual scenarios. These reductions are
  equivalent to eliminating the annual  GHG emissions
  from more than 8 million vehicles.
• EPA has received initial GHG inventories from 111 partners.
  This is a necessary step for all partners before establishing
  an emissions reduction goal. EPA technical experts
  performed 81 site visits to review partner GHG inventories
  and Inventory Management Plans and to recommend
  improvements.
• EPA road-tested draft offsets protocols, released
  guidance on setting carbon neutral goals and using
  offsets toward meeting reduction goals, and published a
  peer-reviewed paper on negotiating aggressive goals to
  provide rigorous, yet flexible, accounting principles for
  companies to manage their GHG emissions. These tools
  join the suite of existing Climate Leaders resources for
  companies to manage and reduce their GHG emissions
  (see Table 7).
• EPA recognized those partners that have set emissions
  reduction goals in a public service announcement (PSA)
  and supplements that ran in nine publications with a
  combined circulation of more than 10 million.


What to Expect in 2008 and Beyond
EPA will continue to recruit  new, diverse partners to be
part of the Climate Leaders  program, as well as support
existing  partners that are working toward achieving
their GHG reduction goals. In 2008, EPA expects to
welcome an additional 35 partners into the Climate
Leaders program and  anticipates 25 current partners will
announce new corporate GHG reduction goals. In addition,
the Climate Leaders program will release a guide for small
businesses to reduce their carbon footprint. EPA will
continue to incorporate the  tenets of Climate Leaders
program protocols and lessons from partner reporting
experiences into the development of future climate  policy.
12

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                                                                                                         CLIMATE LEADERS
        TABLE 5. Climate Leaders key program indicators for 2004 - 2007 (cumulative)
CLIMATE LEADERS INDICATOR
Partners
Initial Inventories Submitted
Site Visits
Goals Announced
Goals Achieved
2004
64
45
9
25
0
2005
78
60
30
38
5
2006
107
75
42
59
8
2007
155
111
81
80
15
        FIGURE 8. The 155 Climate Leaders
        by sector

                       Healthcare
                           9
                   Utilities
                     10
            Financial
              14
        Information
         Services
           23
                        Materials
                      Manufacturing
                          28
  Industrial
Manufacturing
    27
             TABLE 6. Seven Climate Leaders achieve their climate protection
             goals in 2007
PARTNER
Advanced Micro Devices Inc.
Caterpillar, Inc.
Hasbro, Inc.
Pfizer Inc.
Roche Group U.S. Affiliates
Sun Microsystems, Inc.
Xerox Corporation
GOAL ACHIEVED
AMD achieved its initial goal by reducing global
GHG emissions by 53% per manufacturing index
from 2002 to 2006.
Caterpillar achieved its initial goal by reducing
global GHG emissions by 28% per dollar revenue
from 2002 to 2006.
Hasbro achieved its initial goal by reducing total
U.S. GHG emissions by 43% from 2000 to 2007.
Pfizer achieved its initial goal by reducing global
GHG emissions by 43% per million dollars of revenue
from 2000 to 2007.
Roche achieved its initial goal by reducing total
U.S. GHG emissions by 11% from 2001 to 2006.
Sun achieved its initial goal by reducing total
U.S. GHG emissions by 23% from 2002 to 2007.
Xerox achieved its initial goal by reducing total global
GHG emissions by 18% from 2002 to 2006.
        TABLE 7. Key resources of the Climate Leaders Program
          RESOURCES FOR CALCULATING GREENHOUSE GAS
          (GHG) EMISSIONS
                        RESOURCES FOR CALCULATING GREENHOUSE GAS (GHG)
                        REDUCTIONS FROM OFFSET INVESTMENTS AND
                        RENEWABLE ENERGY PURCHASES
          • Design Principles: overall guidance on developing a
            corporate-wide GHG inventory
          • Cross-Sector Guidance Documents
            • Stationary Combustion
            • Electricity and Steam
            • Mobile Combustion Sources
            • Refrigeration and Air Conditioning (use)
          • Sector-Specific Guidance Documents
            • Municipal Solid Waste Landfilling
            • Refrigeration and Air Conditioning (manufacturing)
            • Iron and Steel Production
            • Aluminum Production
            • Cement Production
            • Pulp and  Paper Production
                         • Offset Project Methodologies
                          • Commercial Boiler
                          • Industrial Boiler
                          • Landfill Methane
                          • Manure Management: Anaerobic Digester
                          • Reforestation/Afforestation
                          • Transit Bus Efficiency
                         • Green Power Purchases
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                                                13

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     ENERGY  STAR  OVERVIEW
           ENERGYSTAR
                    Climate change has emerged as
                    one of the world's most significant
                    environmental challenges, and
                    energy efficiency offers one of the
                    lowest cost options for reducing
                    the greenhouse gas emissions that
                    contribute to climate change—all
while saving money and growing the economy. Since its
inception in 1992, the ENERGY STAR program has worked
to dismantle identifiable and pervasive market barriers
stifling the adoption of cost-effective, energy-efficient
technologies and practices in the residential, commercial,
and industrial sectors. And since 1996, the U.S. Department
of Energy (DOE) has joined with EPA and assumed specific
ENERGY STAR program responsibilities.

The number of products, practices, and policies that EPA
offers through ENERGY STAR grows every year, allowing
an ever-increasing number of American organizations and
consumers to save money on their energy bills while
protecting the environment. Nevertheless, numerous
opportunities still exist for cost-effective energy efficiency
investments. Given the rising concerns about the
environmental, economic, and security implications of
energy use, the nation's need to invest in energy efficiency
is greater than ever.

The ENERGY STAR program plays a vital role as a credible,
objective source of information for Americans wanting to
make well-informed decisions to improve the energy
efficiency of their homes and businesses. By clearly
identifying the financially attractive options that save
energy, the ENERGY STAR program has helped millions of
consumers and thousands of businesses and organizations
save money and protect the environment—and the
program is poised to continue to do so well into the future.
Achievements in 2007
The broad achievements across the ENERGY STAR
program include the following:

• Americans saved about $16 billion on their utility bills
  across the residential, commercial, and industrial
  sectors (see Table 1, p. 3), largely by avoiding the need
  for more than 180 billion kilowatt-hours (kWh) of
  electricity or almost 5 percent of the total 2007 U.S.
  electricity demand. This included 38 gigawatts (GW) of
  peak power, or the equivalent of the generation capacity
  of almost 65 new power plants.
• Americans also avoided more than 40 million metric tons
  of greenhouse gas emissions (see Table 8), equivalent to
  the greenhouse gas emissions from 27 million vehicles.
• Facilitating the purchase of energy-efficient products
  and improving  the level of energy efficiency in new home
  construction and existing home renovations accounted
  for about 40 percent of the program benefits achieved,
  while promoting improved energy management
  strategies for organizations in the commercial and
  industrial sectors accounted for the remaining 60 percent.
• U.S. consumers purchased about 500 million
  ENERGY STAR  qualified products in 2007, and about
  12 percent of all new homes  built in 2007 earned
  the ENERGY STAR.5
• Nationwide awareness of ENERGY STAR continued to
  grow, and it is  now recognized by more than 70 percent
  of the American public.
• EPA completed an assessment of the ENERGY STAR
  brand, working with a leading brand strategy and
  management company. The assessment found the
  ENERGY STAR  brand to be strong and provided
  recommendations for protecting the integrity of the
  brand in the coming years (see Figure 9).6
14
          5 Single-family site-built new homes
          " For more information, see Interbrand, 2007.

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                                                                                                                    ENERGY STAR OVERVIEW
         TABLE 8. ENERGY STAR program achievements exceed goals in 2007

Energy Saved
(Billion kWh)
Goal Achieved
All Qualified Products1 87.8
Commercial Buildinq Improvements 78.3
New Homes — 1.7
Industrial Improvements4 14.1
PROGRAM TOTAL for ENERGY STAR 150 181.85

Emissions Avoided
(MMTCE)
Goal Achieved
16.5 17.6
12.5 18.0
0.8 0.5
3.9 6.3
33.7 42.4

Energy Saved Emissions Avoided
(Billion kWh) (MMTCE)
Goal Goal
— 18.5
— 13.5
1.0
4.2
165 37.2
ACHIEVEMENTS BY PRODUCT TYPE
Energy Saved 2007
(Billion kWh)
Consumer Electronics 14.7
Residential Appliances7 1.
0
Residential Office Equipment 8.5
Lighting 7.
1
Heating and Cooling 7.2

Commercial Appliances 1.
4
Office Equipment 39.5
Commercial Liqhtinq 1.
4
Other 7.0
Commercial Products 49.3
Emissions Avoided 2007
(MMTCE)
2.8
0.2
1.6
1.3
2.4

0.3
7.5
0.3
1.2

         12                                                                3
          Results for qualified products from Sanchez et si, 2008. Results from building improvements based on methodology presented in Horowitz, 2008. Results for qualified homes from CPPD,
          2008.  Electricity results from industrial improvements based on methodology presented in Horowitz, 2007.  The kWh savings imply peak demand savings of more than 35gigawatts (GW),
          based on conservation load factors developed by LBNL (Koomey et al., 1990). A small portion of consumer electronics may be used in commercial buildings such as hotels. For reporting
          purposes, all consumer electronics results are included under Residential Products.  EPA results only, does not include products under the responsibility of DOE. Totals may not equal
          sum of components due to independent rounding.
          —.• Not applicable
         FIGURE 9. Keeping ENERGY STAR strong for the future
                   ng a Powerfu
             inducing Brand:
             ~ie Past, Present, and  Future
                the ENERGY STAR Brand
In 2007, an international brand consulting firm, Interbrand, released a report on the
ENERGY STAR brand, which focused on:
* The art and science of branding.
• The core principles of the ENERGY STAR brand.
• The evolution of the ENERGY STAR brand.
* Future opportunities and challenges for the brand.
* Ways to ensure future success of the brand.
According to  this report, "ENERGY STAR has grown into a well-recognized consumer brand, the
result of well-crafted strategies, market-defined insights, and a perseverance to always improve on the
past." In addition, the report noted that, "...EPA has put the brand management tools and standards
in place to manage the brand for continued success."
The report is  available at www.energystar.gov/publications.
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                                                          15

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           EPA now engages more than 12,000 businesses and
           organizations across the country to spur the adoption of
           energy-efficient products, practices, homes, buildings,
           and services that lower energy bills and benefit the
           environment. These partners include:

           • About 2,000 manufacturers using the ENERGY STAR to
            distinguish the energy efficiency of over 40,000 individual
            product models across more than 50 product categories.
            These products can save consumers up to 30 percent in
            total savings on their household energy bills (see Table 9).
           • More than 1,000 retail partners bringing ENERGY STAR
            qualified products and  educational information to their
            customers.
           • More than 5,000 builder partners constructing new
            homes that qualify for the ENERGY STAR in every state
            and the District of Columbia.
• About 3,000 private businesses and public sector
  organizations investing in energy efficiency and
  reducing energy use in their buildings and facilities.
• More than 40 states, 550 utilities, and many  other
  energy efficiency program sponsors leveraging
  ENERGY STAR to improve the efficiency of commercial
  buildings, industrial facilities, and homes.
• Hundreds of energy service providers, energy raters,
  architects, building engineers, and financial lenders
  making energy efficiency more widely available through
  ENERGY STAR and providing additional value to their
  customers.

EPA and DOE recognized the outstanding commitments
of 74 partners at the 2007 Partner of the Year Awards
(see Figure 10).
            TABLE 9. Average energy savings of ENERGY STAR qualified products
ENERGY STAR
PRODUCT CATEGORY
AVERAGE ENERGY SAVINGS**
ABOVE STANDARD PRODUCT
Office
Monitors
Computers
Fax machines
Copiers
Multifunction devices
Scanners
Printers
20-60%
5-55%
20%
20%
20%
50%
10%
Consumer Electronics
TVs
VCRs
TVs/DVDs/VCRs
DVD products
Audio equipment
Telephony
25%
30%
90%
60%
60%
55%
Digital-to-analog converter (DTA) 50%
External power adapters
Battery charging systems
35%
35%
HVAC
Furnaces
Central air conditioners
Air source heat pumps
Geothermal heat pumps
Boilers
Programmable thermostats
Light commercial HVAC
15%
15%
10%
30%
5%
15%
5%
ENERGY STAR AVERAGE ENERGY SAVINGS**
PRODUCT CATEGORY ABOVE STANDARD PRODUCT
Lighting
Compact fluorescent light bulbs (CFLs)*
Decorative light strings
Residential light fixtures
75%
70%
75%
Residential Appliances
Room air conditioners*
Dehumidifiers
Room air cleaners
Exhaust fans
Ceiling fans
Dishwashers*
Refrigerators*
Clothes washers*
10%
15%
45%
70%
45%
20%
15%
30%
Commercial Appliances
Water coolers
45%
Commercial solid door refrigerators and freezers 35%
Commercial hotfood holding cabinets
Commercial fryers
Commercial steamers
Vending machines
60%
15%
55%
40%
Home Envelope
Insulation/Sealing
Roof
Windows, doors, & skylights*
N/A
N/A
N/A


            * DOE managed products
            ** Actual savings will vary by climate region and home characteristics.
16

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                                                                                                         ENERGY STAR OVERVIEW
        FIGURE 10. ENERGY STAR Awards
The success of the ENERGY STAR program depends on the initiative and day-to-day efforts of its thousands of partners. EPA and DOE
recognized 74 of more than 12,000 partners at the annual ENERGY STAR Partner of the Year Awards for their outstanding work in 2007
advancing energy efficiency in the United States. Their accomplishments
SUSTAINED EXCELLENCE

*3M
Olvl
Cf Pa,,! Ml\l
OL. raulf IVIIv
Advantage IQ, Inc.
^nntanp \A/A
OfJUnaltCf Wf-\
Austin Energy
Austin, TX
California Portland Cement
Company
Glendora, CA
CenterPoint Energy
Houston, TX
Food Lion, LLC
Salisbury, NC
Ford Motor Company
Dearborn, Ml
GE Consumer & Industrial
Louisville, KY
Giant Eagle, Inc.
Pittsburgh, PA
Gorell Enterprises, Inc.
Indiana, PA

Marriott International Inc.
Bethesda, MD

Merck & Co., Inc.
Whitehouse Station, NJ
Nevada ENERGY STAR Partners
Las Vegas, NV
New York State Energy Research
and Development Authority
Albany, NY
NewYork-Presbyterian Hospital
New York, NY
Northeast ENERGY STAR
Products Initiative
Lexington, MA
Oncor Electric Delivery
Dallas, TX
OSRAM SYLVAN IA
Danvers, MA
PepsiCo
Purchase, NY
ProVia Door
Sugarcreek, OH

Raytheon Company
Waltham, MA


Sea Gull Lighting Products, LLC
Riverside, NJ

Southern California Edison
Rosemead, CA
Toyota Motor Engineering &
Manufacturing North America,
Inc.
Erlanger, KY
Transwestern
Houston, TX
USAA Real Estate Company
San Antonio, TX
Whirlpool Corporation
Benton Harbor, Ml
Wisconsin Focus on Energy
Madison, Wl
PARTNER OF THE YEAR
A llprn?i n 1 HP
rAMCI LJClll, 1 1 IU.
Irvine, CA

ArcelorMittal USA
Chicago, IL
Arizona Public Service (APS)
Phoenix AZ

Building Owners and Managers
Association (BOMA)
International
Washington, DC
CB Richard Ellis, Inc.
Los Angeles, CA
Colorado Springs Utilities
Colorado Springs, CO
Council Rock School District
Newtown, PA
Energy Inspectors
Las Vegas, NV

Environmental Building Solutions
Matthews, NC
Gresham-Barlow School District
Gresham, OR
ITW Food Equipment Group,
North America
Troy, OH
J. C. Penney Company, Inc.
Piano, TX




are summarized in the report, Profile.
Lithonia Lighting, an Acuity
Brands Company
Conyers, GA

National Grid
Westborough, MA
Pacific Gas and Electric
Company
San Francisco, CA
Pella Corporation
Pella, IA
Providence Health & Services
Seattle, WA
Rocky Mountain Power
Salt Lake City, UT
Seattle Lighting
DestinationLighting.com
Seattle, WA
Simon Property Group
Indianapolis, IN
Southern Energy Management
Raleigh, NC
Southwest Energy
Conservation, LLC
El Paso, TX

The Dow Chemical Company
Midland, Ml
The Joint Management
Committee representing
Massachusetts
New Homes with ENERGY STAR
Massachusetts
TIAA-CREF
New York, NY
TRC Energy Services
Windsor, CT

AWARDS FOR EXCELLENCE

Best Buy Co., Inc.
Richfield, MN
Bosch Home Appliances
Huntington Beach, CA
Canon USA, Inc.
Lake Success, NY
Efficiency Vermont
Burlington, VT

Energy Trust of Oregon, Inc.
Portland, OR
Forest City Stapleton
Denver, CO
in Leadership*
Georgia Power
Atlanta, GA

Haven Properties
Alpharetta, GA
Ideal Homebuilders
Lexington, KY
Ivey Residential
Evans, GA
Long Island Power Authority
Uniondale, NY

Lowe's Companies, Inc.
Mooresville, NC
Nashville Area Habitat for
Humanity
Nashville, TN
Nationwide Marketing Group
Winston-Salem, NC
Nevada Power & Sierra Pacific
Power ENERGY STAR Lighting
and Appliance Program
Reno, NV
NJBPU, New Jersey's Clean
Energy Program
Newark, NJ

Pacific Gas and Electric
Company
San Francisco, CA
The Home Depot
Atlanta, GA
Utah Division of Housing and
Community Development
Salt Lake City, UT
Virgin Islands Water and Power
Authority
St. Thomas, U.S. Virgin Islands
Winton/Flair Custom Homes
El Paso, TX

SPECIAL RECOGNITION
3M's Optical Systems Division
St. Paul, MN
Lennar Homes — Bay Area,
California
San Ramon, CA
Menards
Eau Claire, Wl



         * For more information, see www.energystar.gov/ia/partners/pt_awards/2008_profiles_in_leadership.pdf
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
17

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     ENERGY STAR IN  THE  RESIDENTIAL SECTOR
          High utility bills and growing interest in green products
          and practices are leading an ever-increasing number of
          Americans to use ENERGY STAR as a trusted guide for
          improving the efficiency of their homes, saving money,
          and preventing greenhouse gas emissions. By using
          the ENERGY STAR qualified products and practices
          recommended by EPA, households can reduce their
          energy use up to 30 percent and save $600 a year on
          their utility bills—all while enjoying the comfort and
          performance levels they expect. In 2007, many households
          benefitted from:

          • Buying products that earned the ENERGY STAR (see
            Figure 11).
          • Assessing the  efficiency of their homes and
            undertaking home improvement projects that go
            beyond buying efficient products.
          • Purchasing new homes that earned the ENERGY STAR.


          ENERGY STAR Qualified Products
          Activities in 2007 included adding new qualified products,
          updating specifications for select products (see Table 10),
          continuing national and international government
          coordination, and promoting broad outreach efforts that
          help consumers find ENERGY  STAR qualified products.
          Highlights of these activities are described  below.

          New ENERGY STAR Qualified Products. EPA
          added two new product categories to the ENERGY STAR
          program. In anticipation of the nationwide changeover to
          digital television  signals in February 2009, EPA established
          a new specification for digital-to-analog converter boxes
          (DTAs) that is expected to cut the energy use of these
          devices by more  than 70 percent, with the potential to
          save Americans  over $1 billion in energy costs. In
          addition, EPA adopted the specification developed for
          ENERGY STAR by Natural Resources Canada for
          decorative light strings. By using solid state lighting
          technology, an ENERGY STAR  qualified decorative light
          string consumes  70 percent less energy than an
          incandescent light string.
Raising the Bar for ENERGY STAR. In 2007, EPA
finalized revisions for an additional two specifications.
One was a groundbreaking revision to the ENERGY STAR
specification for residential light fixtures. For the first time,
consumers will be able to purchase qualified GU-24 based
compact fluorescent light bulbs (CFLs) for use in ENERGY
STAR qualified fixtures.7 The  bulbs allow consumers to
change the light output, shape, and color of the bulbs
without rewiring. Most other qualified fixtures use less
flexible, fixed-wattage bulbs.

Awareness of ENERGY  STAR Continues to
Grow. The success of the ENERGY STAR program
depends on public awareness of the financial and
environmental benefits of ENERGY STAR qualified
products, homes, and buildings. The 2007 ENERGY STAR
national campaigns and PSAs reached millions of people
through TV, magazine, radio,  and other media outlets.
Articles mentioning ENERGY  STAR reached over one
billion readers. Public awareness of the ENERGY STAR
label grew to more than 70 percent in 2007—a  20
percentage point increase over the past 5 years (see
Figure 12). Other highlights of the survey findings8 include:

• Public awareness is even  greater—80 percent—in
  major markets where local utilities and other
  organizations use ENERGY STAR as the platform to
  promote energy efficiency to their customers.
• More than 35 percent of American households
  knowingly purchased an ENERGY STAR qualified
  product in 2007.
• More than 70 percent of these households reported
  being favorably influenced by the ENERGY STAR label,
  up from about 50 percent in 2003.
• More than 80 percent of these households reported they
  are likely to recommend ENERGY STAR products to their
  friends, with 29 percent of households reporting they
  are "extremely likely" to do so.

Further, the ENERGY STAR Web site  experienced
significant growth in 2007. Visitor sessions reached
10 million, up from 7 million in 2006.
18
           Most qualified fixtures use the GU-24 base, which accepts pin-based CFLs rather than screw-based bulbs.
          8 For more information, see U.S. EPA, 2008b.

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                                                                                   ENERGY STAR  IN THE RESIDENTIAL SECTOR


        TABLE 10. ENERGY STAR residential product specifications added, revised, and in progress
Product Category
Year Introduced
and (Year Revised)
Responsible
Agency
Status of Activity
in 2007
NEW SPECIFICATIONS
Digital-to-Analog Converter
Boxes (DTAs)
Decorative Light Strings
2007 REVISIONS COMPLETED
Residential Lighting Fixtures
Roof Products
2007
2007
1997(2001,2002,
2003, 2005)
1999(2001,2003,2007)
EPA
EPA

EPA
EPA
New specification took effect January 31, 2007.
New specification took effect in August 2007.

Revision completed. Revised specification
to take effect August 1,2008.
Revision completed. Revised specification
took effect December 31, 2007.
2007 REVISIONS IN PROGRESS
Computers
External Power Adapters
Furnaces
Imaging Equipment
Monitors/Displays
Programmable Thermostats
Set-Top Boxes
Telephony
Televisions
Ventilation Fans
1992(1995,1999,
2000, 2007)
2005
1995(2006)
2007
1992(1995,1998,
1999,2005,2006)
1995
2001
2002 (2004, 2006)
1998(2002,2004,2005)
2001 (2003)
EPA
EPA
EPA
EPA
EPA
EPA
EPA
EPA
EPA
EPA
Revision initiated in 2007, expected to be complete in 2008.
Revision initiated in 2007, expected to be complete in 2008.
Revision initiated in 2007, expected to be complete in 2008.
Revision initiated in 2007, expected to be complete in 2008.
In progress.
In progress.
Specification suspended in 2005. Revision initiated in 2007,
expected to be complete in 2008.
Revision initiated in 2007, expected to be complete in 2008.
Revision initiated in 2007, expected to be complete in 2008.
In progress.
        FIGURE 11. More than 2.5 billion ENERGY STAR qualified

        products purchased since 1992
             3.0
          °  1.0
             0.5
                 2000    2001    2002   2003   2004   2005   2006    2007

                • Other          Lighting           • Home Office Equipment

                 Appliances       Home Electronics     • Office Equipment
FIGURE 12. Awareness of ENERGY STAR growing

in the United States
  80%.




  70%.




  60%.




  50%.




  40%,




  30% I




  20% I




  10% I




    ol
      PI
n     i
i    i     i
i    i     i
i    •    •
i    •    i
i    •    •
i    i    •
     2000    2001    2002*   2003*   2004*    2005    2006*   2007*



      I Aided Awareness  I Unaided Awareness
                                                                      "Annual result is statistically different from the result of the prior year.
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                       19

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           ENERGY STAR Change a Light, Change the
           World Campaign. The eighth annual ENERGY STAR
           Change a Light, Change the World campaign was a major
           part of the year's outreach efforts. The first-ever ENERGY
           STAR Change a Light bus tour stopped at 16 events in
           10 cities across the United States (see Figure 13),
           engaged more than 1,100 organizations, and catalyzed over
           1.3 million pledges to replace an incandescent light with
           an  ENERGY STAR qualified CFL

           Continuing International Cooperation. In 2007,
           EPA signed a Memorandum of Understanding (MOU) with
           the China Standard Certification Center (CSC) to explore
           harmonization of ENERGY STAR  and the Chinese labeling
           programs. In addition, EPA continued its collaboration
           with the European Union in revising specifications for
           ENERGY STAR qualified office equipment and its work as
           co-chair of the Asia-Pacific Partnership's Buildings and
           Appliances Task Force.


           Home Improvement through ENERGY STAR
           In addition to purchasing ENERGY STAR qualified products,
           homeowners can take a number of steps to reduce the
           overall energy consumption of their homes, raise the value
           of their homes, and improve their comfort, safety, and
           health. These steps range from using the  online ENERGY
           STAR Home Advisor to identify recommended improvements
           to having a whole-house energy assessment and retrofit
           performed by a trained, qualified technician. EPA's home
           improvement programs offer consumers tools, resources,
           and information to help guide them through the various
           stages of home improvement. Highlights of 2007 follow.

           Home Performance with ENERGY STAR. Home
           Performance with ENERGY STAR is an effort supported by
           EPA and DOE to promote whole-house, energy efficiency
           retrofits through a qualified contractor network that is
           backed by a quality assurance program. EPA estimates
           that a typical  home can save, on  average, more than
           20 percent of its total energy use and  between $400 and
           $500 a year if the recommended improvements are made.
           Regional sponsors implement Home Performance with
           ENERGY STAR by recruiting and training contractors,
           marketing contractor services, and overseeing the quality
           of their work. In 2007:

           • More than 11,000 Home Performance with ENERGY
            STAR retrofits were reported by program sponsors,
            bringing the total number of homes improved under
            this program to over 38,000 retrofits.
• Seven new program sponsors brought the total number of
  regional and local sponsors to more than 20 (see
  Figure 14).9
• EPA, in conjunction with DOE and the U.S. Department
  of Housing and Urban Development (HUD), concluded a
  3-year grant with the Building Performance Institute
  (BPI) to develop a home performance contractor
  infrastructure. BPI reported more than 1,500 certified
  technicians in 34 states and 300 accredited contractors
  in 9 states by the end of 2007.
• EPA recognized six partners in 2007—Austin Energy,
  Efficiency Vermont, the New Jersey Board of Public
  Utilities, National Grid, New York State Energy Research
  and Development Authority (NYSERDA), and Wisconsin
  Focus on Energy—for their successful implementation
  of Home Performance with ENERGY STAR.

The Home Energy Advisor. EPA released the
Home Energy Advisor, an interactive Web-based tool
that offers homeowners recommendations on how to
improve the efficiency of their homes. The tool complements
the Home Energy Yardstick, which gives homeowners a
ranking, on a scale from 1 to 10, of the efficiency of their
home. In 2007, more than 95,000 homeowners benchmarked
their homes with the Yardstick, and 23,000 identified
specific recommendations using the Home Energy Advisor.

Seal and Insulate with ENERGY STAR. Air
sealing and insulation are among the easiest, cost-
effective ways to reduce energy bills and increase  home
comfort. In 2007, EPA developed new retail-oriented
materials and helped retail partners  promote this
information. In addition, homeowners downloaded more
than 80,000 copies of EPA's Do-lt-Yourself Guide to
Sealing and Insulation.

Proper HVAC Installation. Installing and maintaining
an appropriately sized heating, ventilation, and air
conditioning (HVAC) system can offer homeowners significant
energy savings. EPA estimates that the improper sizing
and installation of an HVAC system can reduce system
performance by as much as 30 percent, and that more
than half of all systems nationwide are installed incorrectly.
In 2007, EPA launched an HVAC Quality Installation  (Ql)
program in collaboration with two utilities, Oncor and
Southern California Edison, setting the stage for a national
program rollout in 2008. The HVAC Ql program provides
an industry-accepted set of installation guidelines to
ensure that the system performs at its  rated capacity.
20
            New program sponsors in 2007 for Home Performance with ENERGY STAR include: City of Anaheim, CA, First Energy, Foundation for Senior Living,
            Gainesville Regional Utility, Maryland Energy Administration, Missouri Department of Natural Resources, and Southern California Edison.

-------
                                                                                          ENERGY STAR IN THE RESIDENTIAL SECTOR
         FIGURE 13. National bus tour helps ENERGY STAR campaign reach millions

                                                                                           _ » . •«• * ffli "go"%^
                                                                                         • Ties Moinas   OCT. 12-13 • T
                                                                                               OCT. ID         ^Indianapolis
                                               NewYo
                                               OCT. 23
                                                                                                                 Atlanta
                                                                                                                 OCT. 15
On Wednesday, October 3, 2007—
ENERGY STAR Change a Light Day—EPA
kicked off the first-ever ENERGY STAR
Change a Light bus tour. As the newest
strategy in EPA's highly successful ENERGY
STAR Change a Light, Change the World
campaign, the bus completed a 20-day
national tour, stopping at 16 events in 10
cities on its way from Anaheim, CA, to
Boston, MA. Sponsored and hosted by
ENERGY STAR partners, the bus made its
way east showing Americans how just one
small action—changing an incandescent
bulb to a  CFL—taken by many individuals
can collectively make a tremendous
contribution to addressing the problem of
global climate change.
The bus tour received extensive  media coverage in the 10 markets visited. Highlights included television segments on NBC's Today Show and
Los Angeles' highly-rated news KABC, a live interview segment on Good Day Colorado! (KDVR), and a spotlight of the bus tour and Durham
Middle Schools as part of the Atlanta, GA, tour stop on WSB-TV.  In addition to broadcast coverage, the bus tour was featured in photo spreads
in The Boston Globe and Boston Herald and in articles in online media outlets Reuters and CNNMoney.com. All told, local, regional, and national
coverage of the tour and campaign resulted in more than 27 million media impressions during the fall of 2007, as well as more than
85 million online impressions during the same time.
                                                                                                                           STAR"
         FIGURE 14. Home Performance with ENERGY STAR spreads across the country
                                 I States with Home Performance
                                  with ENERGY STAR Programs
Metro Areas with Home Performance
with ENERGY STAR Programs
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                                21

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           ENERGY STAR Qualified New Homes
           ENERGY STAR qualified homes held steady at about 12
           percent of the housing market nationwide even though
           the number of qualified homes totaled more than 120,000
           as the new construction market retracted during 2007.
           ENERGY STAR remains a dominant presence in more than
           50 markets where the penetration of qualified homes
           equals or exceeds 20 percent of the housing stock (see
           Figure 15). To date, the number of ENERGY STAR qualified
           homes constructed totals almost 840,000, providing
           homeowners savings of more than $200 million annually
           (see Figure 16). EPA's 2007 efforts  included:

           New Homes Outreach Partnership. EPA worked
           with 28 local markets in 17 states to mount long-running
           consumer campaigns for ENERGY STAR qualified new
           homes. This partnership leveraged  federal efforts with
           local private-sector funds to increase the  promotion of
           ENERGY STAR qualified homes during the peak buying
           seasons for new homes.

           Affordable Housing. More than 7,700  ENERGY STAR
           qualified homes were built using  public funding in FY 2007,
           guaranteeing that the families most in need will save
           money on their utility bills. EPA worked with 21 state
           housing finance agencies (HFAs) to promote ENERGY
           STAR qualified products and homes in their funding
           criteria for housing projects. More that 30 HFAs now give
           preference to projects that include ENERGY STAR
           products and construction guidelines, while four states—
           New Jersey, Nevada, Utah, and Washington—now
           require all new homes funded with housing tax credits to
           be ENERGY STAR qualified.

           Marketing Tools That Work. EPA updated its
           marketing kit for home builders so they have the means to
           develop customized ads, brochures, and signage. Through
           this Web-based toolkit, each  builder can incorporate its
           own brand message within the ENERGY STAR marketing
           template.

           Green Homes. EPA continued to work with green building
           programs across the country to promote ENERGY STAR as
           the first step to a green home. Leadership in Energy and
           Environmental Design® (LEED) requires, at a minimum, that
           a LEED Home be built to the ENERGY STAR specification.
           Through the Office of Radiation and Indoor Air, EPA also
           refined its indoor air quality program, coupling indoor air
           specifications with ENERGY STAR Homes to provide a
           significant step toward  green construction.
Exploring Energy Efficiency in Multi-Family
High Rises. In 2007, the State of New York, through
NYSERDA, and the Energy Trust of Oregon kicked off their
ENERGY STAR Multi-Family High Rise Programs, labeling
several buildings whose energy efficiency is at least
20 percent better than those built to the commercial building
code. These projects will help develop a national ENERGY
STAR effort to label efficient multi-family high rise buildings.


What to Expect in 2008 and Beyond
• EPA will finalize specification revisions for a variety of
  home electronics (TVs, set-top boxes, and external
  power adapters), office equipment (imaging equipment
  and computers), and furnaces. In addition, EPA will
  initiate a new specification for game consoles and
  start specification revisions for audio equipment and
  DVD players. EPA will continue to  expand the ENERGY
  STAR label to new product categories when the core
  program principles can be met and will  revise the
  requirements for product categories already in the
  program as conditions warrant.
• EPA will continue to work with its vast partnership
  network to help consumers and businesses of all sizes
  choose ENERGY STAR qualified products—particularly
  lighting products, small household appliances,
  commercial food service equipment, office equipment,
  and heating and cooling products. Overall, EPA expects
  more than 300 million ENERGY STAR qualified products
  to be sold each year for the foreseeable future.
• EPA projects more than 50,000 homes will be improved
  through Home Performance with ENERGY STAR by the
  end of 2008. Five new sponsors are expected to join in
  2008.
• EPA will launch the ENERGY STAR HVAC Ql program
  in 2008 in Texas and focus on recruitment in  2008 to
  broaden the adoption of this program.
• EPA will continue to promote ENERGY STAR  qualified
  new homes to meet the builders' need to differentiate
  themselves in the tight housing market and the
  growing consumer demand for energy-efficient and
  green homes. EPA will also explore the  next generation
  of ENERGY STAR specifications for new homes through
  vehicles such as EPA's new Climate Choice program
  (see page 34).
• EPA will continue to develop the ENERGY STAR Multi-
  Family High Rise Program for new construction and
  intends to expand the pilot to New Jersey, Colorado,
  and Nevada in 2008.
22

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                                                                                ENERGY STAR  IN THE RESIDENTIAL SECTOR
        FIGURE 15. ENERGY STAR qualified new homes gaining market share
                                                               Increasing Percentage of
                                                               Single Family Home Starts
                                                                  <3%     3-11%    12-20%   >20%
        FIGURE 16.840,000 homes nationwide bear the ENERGY STAR
             900,000
             800,000
             700,000
             600,000
             500,000
             400,000
             300,000
          .2
          i 200,000
          o
          I 100,000
          1       o
GO
                                          Z
                                 I    I   I    I
                    2000   2001  2002   2003  2004  2005   2006  2007*
                    • CUMULATIVE HOMES BUILT      ANNUAL HOMES BUILT
                    "Reflects transition to more stringent specification and slow down in U.S. housing starts.
ENERGY STAR qualified new homes can
include a variety of tried-and-true
energy-efficient features:
* Tight construction and ducts
• Effective insulation systems
• Efficient heating and cooling equipment
• High-performance windows
• Efficient lighting and appliances
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                                                                               23

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     ENERGY STAR  IN  THE  COMMERCIAL  SECTOR
           Commercial businesses and organizations are
           increasingly turning to ENERGY STAR to learn how to
           improve the energy efficiency of their buildings and
           facilities and prevent greenhouse gas emissions.
           Commercial buildings alone represent 14.5 percent of U.S.
           (C02) emissions and account for more than $100 billion in
           energy costs.10 Through ENERGY STAR, EPA promotes
           corporate energy management approaches by offering
           guidance, tools, and other resources to help  businesses
           and organizations reduce their energy use.

           Working closely with leading businesses, trade
           associations, and local governments to bring energy
           and climate change solutions to their constituents,
           EPA leveraged ENERGY STAR to deliver unprecedented
           progress in the commercial marketplace in 2007. These
           efforts resulted in exponential growth in the number of
           buildings rated for their energy use, in buildings that
           earned the ENERGY STAR for superior energy
           performance (see Figure 17), and in the use of other
           ENERGY STAR tools and resources.


           Achievements in 2007
           Growing Partnership.  Partnering with ENERGY STAR
           continued to be an important first step for many
           businesses and organizations working to improve
           efficiency and lower energy costs. For example:

           • More than 1,800 commercial, public, and industrial
            organizations have joined EPA's ENERGY STAR
            program and committed  to continuous improvement
            and superior energy management in their buildings.
            These ENERGY STAR partners own or operate more
            than 11.5 billion square feet of building space across
            the country, approximately 15 percent of the
            commercial building market.
           • Close to 20 utilities or other energy efficiency program
            sponsors (EEPS) joined ENERGY STAR in 2007, bringing
            the total to more than 90. These EEPS, along with the
            more than  1,300 Service  and Product Providers, offer
            their clients and customers valuable energy  efficiency
            services that incorporate ENERGY STAR tools and
            resources.
• Nearly 1,500 new participants joined either the
  ENERGY STAR Congregations or Small Business
  Networks, bringing the total to more than 3,000
  members in both networks.

Spurring Building Owners Toward Superior
Energy Performance. In 2007, EPA extended the
reach of the ENERGY STAR Challenge, which calls on all
U.S. businesses and institutions to reduce energy use
by 10 percent or more. By year end, nearly 800 organizations
and individuals had joined the Challenge (see Figure 18).
Leading associations such as the U.S. Conference of
Mayors (USCM) and the Building Owners  and Managers
Association (BOMA) International are reaching out to their
members nationwide and motivating them to work toward
achieving superior energy performance in their facilities.
Below are highlights from 2007:

• The U.S. Conference of Mayors passed a resolution
  endorsing the ENERGY STAR Challenge as the key
  strategy in meeting its goals for the Conference's
  Climate Protection  Agreement. The National
  Association of Counties (NACo) and  Public Technology
  Institute (PTI) also actively promoted the Challenge.
  Their efforts contributed to more than 150 local
  governments joining the Challenge in 2007.
• BOMA launched its 7-Point Challenge to achieve a
  30-percent improvement in members' building
  portfolios and chose ENERGY STAR as the mechanism
  to track and verify improvement. About 25 organizations
  and more than 35 local BOMA chapters responded.
• More than half of the states and the District of Columbia
  have taken the ENERGY STAR Challenge and lead the way
  in rating the most floor space in the country—making up
  nine of the top 10 states in cumulative rated floor space
  through 2007.
• States also enacted legislation to set energy use
  reduction goals and require the use of EPA's tools.
  For example, California passed legislation requiring
  disclosure of the EPA energy performance rating
  starting in 2010 and utility data transfer to Portfolio
  Manager. Ohio approved the adoption of Portfolio
  Manager to fulfill benchmarking mandates, and
  Minnesota enacted  legislation setting  goals for achieving
  ENERGY STAR qualified  buildings in the  state.
24
          '" For more information, see Energy Information Administration (EIA), 2006.

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                                                                                       ENERGY STAR IN THE COMMERCIAL SECTOR
         FIGURE 17. More than 4,000 buildings have earned the ENERGY STAR
                                                                                                      VERMONT   MAINE
                                                                                                              NEW HAMPSHIRE
                                                                                                              MASSACHUSETTS

                                                                                                                 HODE ISLAND
                                                                                                               NECTICUT

                                                     Increasing Number of Qualified Buildings


                                                     <21 Buildings   21-50 Buildings   51-100 Buildings   >100 Buildings
         FIGURE 18. ENERGY STAR Challenge participants
                                 Businesses and
                                 Organizations 4031
Businesses and Organizations
Local Government	159
Associations	36
Real Estate	36
State Government	32
K-12 Education	27
Industrial	21
Services	21
Other	                     ....18
Hospitality & Entertainment	10
Retail	10
Healthcare	9
Higher Education	8
Non-Profit	8
Federal Government	6
Bank/Financial	2
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                                          25

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           Honoring Excellence in Leadership. EPA
           recognized the outstanding accomplishments of
           commercial sector businesses and organizations for
           instituting superior energy management across their
           portfolio of buildings in two main ways:

           • EPA honored 24 organizations for Sustained Excellence
             or as an ENERGY STAR Partner of the Year for Energy
             Management, Service and Product Provider, or Energy
             Efficient Program Delivery.
           • EPA recognized more than 50 partners as ENERGY STAR
             Leaders for meeting important energy-saving milestones
             across their entire building portfolio.

           Making Performance Rating the First Step to
           Improvement. Benchmarking energy use is critical to
           identifying energy efficiency opportunities. Hundreds of
           businesses and organizations are taking the important
           step of using  EPA's energy performance rating system to
           asses the energy use of their buildings. Since 1999, EPA's
           online tool, Portfolio Manager, has enabled building
           owners and managers to rate their individual commercial
           buildings  on a scale of 1 to 100 against similar buildings
           nationwide, track energy performance over time, and target
           investments in energy efficiency (see Figure 21). In 2007:

           • EPA's energy performance rating  system experienced
             exponential growth and was expanded to include retail
             stores.  Over 62,000 buildings have been rated—more
             than double the number since the end of 2006. These
             buildings represent more than 7.5 billion square feet,
             which is an increase of more than 50 percent from
             the previous year (see Figure 19). They include
             55% of hospital space (acute care), more than
             50% of supermarket space, 30% of office  building
             space, nearly 25%  of school space, and nearly 25% of
             hotel space across the country.11
           • Rating of retail space—first made available in 2007—
             accounted  for more than 40 percent of the new activity
             with over 14,000 stores rated, representing more than
             1 million square feet (see  Figure 20).
           • For the first time, water utilities were able to track energy
             use and associated carbon emissions, set targets for
             investment priorities, and verify efficiency improvements
             using Portfolio Manager. In addition, building owners
             tracked water usage alongside their energy use. Partners
             had entered data for more than 10,000 water meters in
             Portfolio Manager by the end of 2007.
           • A key program focus  in 2007 was to help automate the
             transfer of energy data directly into Portfolio Manager,
  eliminating the need for manual entry. Automated
  Benchmarking Services (ABS), which facilitates building
  benchmarking across a portfolio of buildings through
  third-party servers, grew more than 400 percent during
  the year and serviced about 30,000 buildings. Service
  and Product Providers helped rate over 32,000
  buildings—most of them through ABS—and assisted
  close to 500 client buildings in achieving at least a
  10-point improvement in their energy performance
  rating in 2007.

Recognizing More  Buildings for Excellence.
More  buildings than ever qualified for the ENERGY
STAR  in 2007, bringing the total to more than 4,000
buildings, representing  over 740 million square feet.
These top performing buildings earned  the ENERGY
STAR  by achieving a score of 75 or higher on EPA's
energy performance rating system and meeting relevant
requirements for indoor air quality. ENERGY STAR
qualified buildings use nearly 40 percent less energy,
on average, than typical buildings; almost 500 of them
use 50 percent less energy. Their owners save about
$800 million annually on their energy bills compared to
those  of typical buildings. In 2007:

• The first retail stores—four JC Penney stores in the
  state of Washington—and the first warehouses earned
  the  ENERGY STAR.
• CoSTAR,the leading information services  provider to
  U.S. commercial real  estate, integrated ENERGY STAR
  information into its Web site and building research. As a
  result, its online database identifies ENERGY STAR
  qualified buildings for users.

Challenging Small  Businesses to Save Energy.
The number of small businesses and congregations
partnering with EPA through  ENERGY STAR  almost
doubled in 2007. By using ENERGY STAR tools, these more
than 3,300 organizations are improving their energy
efficiency, reducing energy costs, and leading their
communities in environmental stewardship. In addition,
several key associations representing small businesses
and faith-based organizations were active participants in
the ENERGY STAR Challenge in 2007. For example:

• The National Automobile Dealers Association (NADA)
  outreach resulted in  more  than 500 auto dealerships
  becoming ENERGY STAR Small Business Network
  participants. NADA delivered training sessions on
  ENERGY STAR tools and resources to more than 300
  members during the year.
26
           11 Calculated using CBECS 2003, see EIA 2006.

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         FIGURE 19. Commercial building rating and
         labeling activity gains momentum
                                                               ENERGY STAR IN THE  COMMERCIAL SECTOR

                                       FIGURE 20.10 percent of commercial square footage is rated
                                                   I
           5  3
           t
           d
           -  2
               L
           LLJ
           CJ
           CD
               1
           OQ  0
           Ml
      MM
MMI
                 2001   2002  2003  2004  2005  2006  2007

                 • RATED AND LABELED      • RATED ONLY
                                                                3000
                                                                2500
                                                                2000
                                                 Offices    K-12   Retail Hospitals  Hotels  Supermarkets/ Other*
                                                        Schools                        Grocery Stores

                                                'Includes Bank-Financial Institutions, Warehouses, Courthouses, Medical Offices, Residence Halls.
        FIGURE 21. Amount of rated floor space by state
                                                          Increasing Amount of Floor Space Rated


                                                          <25mm sq.ft.  25-75mm sq. ft.   75-150mm sq.ft.   >150mmsq.ft
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                                                                          27

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28
           • The Independent Community Bankers Association
            (ICBA) promoted and supported the benchmarking of
            some 18,000 buildings belonging to its 5,000 members.
            With EPA, ICBA is exploring the design of a "green
            loan" program for members' small business customers.
           • The National Association of Evangelicals hosted
            regional "creation care" conferences in Minnesota
            and Florida, bringing together religious leaders to
            discuss global warming and ways in which using
            technical support from ENERGY STAR could improve
            the stewardship of energy and financial resources in
            houses of worship.
           • EPA honored 14 small businesses and congregations
            with the ENERGY STAR Small Business Award for showing
            exemplary environmental stewardship.

           Adding Efficient Commercial Products. In 2007,
           EPA expanded the suite of commercial  kitchen products
           eligible to earn the ENERGY STAR by finalizing new
           specifications for commercial dishwashers and ice
           machines (see Table 11). The specifications cover several
           types of machines in both categories and require them to
           deliver both energy and water efficiency savings. These
           products will help improve the energy and greenhouse
           gas intensity of food service operations, which consume
           roughly 2.5 times more energy per square foot than other
           commercial buildings. In addition, EPA completed
           revisions to the commercial roofing specification. Given
           the successful transformation of markets for traffic lights
           and transformers, EPA sunsetted the specifications for
           these products.

           Looking at the Impact of Climate Change. EPA
           added carbon emissions factors to the energy performance
           rating system that are consistent with those used by
           major greenhouse gas reporting protocols and allow
           businesses to compare the C02 emissions of their
           buildings to others in the same region and across the
           country. These factors help organizations assess and
           address the climate change impact of their buildings
           according to standardized protocols, prioritize energy
           efficiency improvements, and lessen their buildings'
           impact on the environment. EPA continues to promote
           energy efficiency as the first step to being green by
           working with organizations to develop policies that
           encourage  energy efficiency and reflect the financial
           savings buildings offer when well designed.

           Designing High Performance New Buildings.
           Thirty-five commercial new construction projects
           achieved Designed to Earn the ENERGY STAR in 2007.
           Kinard Junior High School in Poudre, CO, became the
first building to achieve Designed to Earn the ENERGY
STAR in 2005 that went on to earn the ENERGY STAR
label in 2007 based on demonstrated operating
performance.

What to Expect in 2008 and Beyond
EPA will continue to promote greater energy efficiency
across the commercial sector. Specifically, EPA will:

• Work with leading local government partners to help
  them bring ENERGY STAR tools and  resources to their
  communities through the ENERGY STAR Challenge.
  Louisville, KY, will serve as a model  in 2008. In  addition,
  EPA will continue to engage trade associations and
  motivated sectors in spreading awareness of ENERGY
  STAR to additional commercial market sectors.
• Demonstrate to utilities and other energy efficiency
  service providers the value of automatic energy bill
  exchange to make it easier and faster for customers to
  benchmark and effectively manage  their portfolios.
  EPA will also expand the use of ENERGY STAR by these
  organizations to help them deliver greater savings to
  their customers.
• Enhance partner tools by updating the energy
  performance rating system for supermarkets,
  developing a rating system for the data center industry,
  and updating the Automated Benchmarking System to
  improve its ability to manage data in bulk.
• Recognize commercial buildings that are top
  performers in terms of both energy efficiency and
  carbon  emissions, relying on the well-established
  measurement and verification protocols already in
  place in EPA's Portfolio Manager.
• Enhance the measurement and verification capability
  of Portfolio Manager and expand it to include carbon
  emissions reductions from energy efficiency measures
  in commercial buildings. The benchmarking system's
  use of real, verifiable energy use data, combined
  with user-friendly functionality, will  allow building
  owners and others to establish a clear record  of
  carbon  reductions.
• Work with Service and Product Providers to increase
  the use of ENERGY STAR as part of market
  transactions such as performance contracting,
  financing, and other mechanisms.
• Complete new specifications for commercial griddles
  and data servers (see Figure 22)  and complete the
  specification revision for commercial solid door freezers.

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                                                                                            ENERGY STAR IN THE COMMERCIAL SECTOR
         TABLE 11. ENERGY STAR commercial product specifications added, revised, and in progress
PRODUCT CATEGORY YEAR INTRODUCED
AND (YEAR REVISED)
RESPONSIBLE
AGENCY
STATUS OF ACTIVITY
IN 2007
NEW SPECIFICATIONS
Commercial Dishwashers 2007
Commercial Ice Machines 2007
EPA
EPA
New specification took effect October 11, 2007.
New specification to take effect January 1, 2008.
2007 REVISIONS COMPLETED
Roof Products 1999(2001,2003)
EPA
Revision completed. Revised specification
took effect December 21, 2007.
2007 REVISIONS IN PROGRESS
Commercial Refrigerators/Freezers 2001 (2003)
EPA
Revision initiated in 2007, expected
to be complete in 2008.
NEW SPECIFICATIONS IN DEVELOPMENT
Data Servers
Commercial Griddles
EPA
EPA
New specification initiated in 2007.
New specification initiated in 2007.
SPECIFICATIONS SUNSETTED
Traffic Signals 2000 (2003)
Transformers 1995
EPA
EPA
Due to successful transformation of market,
specification was sunsetted, effective May 2007.
Due to successful transformation of market,
specification was sunsetted, effective May 2007.
         FIGURE 22. EPA reports that improving energy efficiency in U.S. data centers could save $4 billion annually
           As the U.S. economy increasingly shifts from paper-based to digital
           information management, data centers have become a vital part of
           business, communication, academic, and governmental systems.
           Over the past 5 years, increased use of these systems—and the power
           and cooling infrastructure that supports them—has doubled energy
           use, increased greenhouse gas emissions, and raised concerns about
           power grid reliability.
           At the request of Congress, EPA published the Report to Congress
           on Server and Data Center Energy Efficiency in 2007, which
           outlined current trends in data center energy use and made
           recommendations to improve the efficiency of data centers in the
           future. Data centers in the United States have the potential to save
           up to $4 billion in annual electricity costs through more energy-
           efficient equipment and operations, as well as the broad
           implementation of best management practices. Other key findings
           from  the report include:
* Data centers consumed about 60 billion kWh in 2006, roughly
  1.5 percent of total U.S. electricity consumption.

* The energy consumption of servers and data centers has doubled in the
  past 5 years and is expected to continue increasing over the next 5 years
  to more than 100 billion kWh, costing about $7.4 billion annually.
* Existing technologies and strategies could reduce typical server
  energy use by an estimated 25 percent, with even greater energy
  savings possible with advanced technologies.

EPA is developing a suite of resources to help managers of U.S. data
centers improve energy efficiency and reduce energy costs, including
developing new ENERGY STAR specifications for data center
equipment, as well as a new energy performance rating that reflects
whole building operations.
For more information, visit www.energystar.gov/datacenters.
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                             29

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     ENERGY STAR  IN  THE  INDUSTRIAL SECTOR
           Increasing uncertainty and volatility in energy markets,
           combined with greater awareness of the need to manage
           greenhouse gas emissions, are stimulating U.S. companies
           to establish corporate energy management programs.
           In search of guidance, tools, and support networks,
           industrial companies are turning to the expanded energy
           management resources available through ENERGY STAR.
           As these corporations embrace energy management, EPA
           has observed that many of them recognize the need to
           adjust their strategies to anticipate future energy and
           environmental risks. Working closely with U.S. industrial
           partners, EPA is  encouraging more comprehensive energy
           strategies and programs that will achieve greater energy
           efficiency and savings.


           Achievements in 2007
           Enhancing Energy Efficiency through
           Advanced Strategies. ENERGY STAR is recognized
           by U.S. industry as a leading source of guidance on the
           fundamentals of developing a corporate energy
           management program. In 2007:
           •  EPA worked with 20 leading senior executives to
             produce Energy Strategy for the Road Ahead, which
             enables corporations and their boards to evaluate
             business risks concerning the future of energy and
             plan accordingly. Distributed to more than 700 CEOs
             of major U.S. industrial companies, this report
             recommends long-term planning and provides a set
             of robust strategies (see Figure 23, p. 33).
           •  EPA partnered with the Carbon Disclosure  Project, over
            30 major institutional investors, and 75 companies to
             discuss best practices in reporting and analyzing
             corporate energy and greenhouse gas management
             approaches and the role of ENERGY STAR as a best
             practice approach.

           Empowering  Industries for Greater Energy
           Efficiency. EPA works directly with individual industrial
           sectors  to improve energy efficiency and overcome
           barriers such as a lack of information and an inability to
           assess energy performance. Through tailored Industrial
           Focuses, EPA and its industry partners develop plant-
           level energy performance indicators (EPIs), support peer
           networking, and produce guidance on improving energy
           efficiency in the industry. As of 2007,14 sectors and
subsectors were actively involved in Industrial Focuses
(see Table 12). EPA advanced existing industry focus
partnerships with automobile manufacturing, cement,
corn refining, food processing, glass, Pharmaceuticals,
petrochemicals, petroleum refining, pulp and paper, and
water/wastewater treatment industries. Highlights of
2007 include:
Plant-level Recognition for Excellence
• Almost 40 industrial facilities—including top
  performing manufacturing plants in the auto  assembly,
  cement, and corn  refining industries where EPIs
  have been established—earned the ENERGY STAR,
  including seven U.S. petroleum refineries earning the
  ENERGY STAR for the first time (see Table  13).
New Tools and Resources
• Initiated studies of plant-level energy performance
  measurement tools for two new subsector industries—
  food processing/potato products and glass manufacturing/
  fiberglass—bringing the total number to eight.
• Released revised draft EPIs for industry review and
  testing for manufacturers of Pharmaceuticals, tomato
  products, fresh juices, flat glass, and container glass.
• Issued the first update of the auto assembly  EPI
  to reflect the  increasing efficiency of the sector.
  The  associated analysis indicates that over the past
  4 years, auto  manufacturers have reduced their
  electricity use by 2 percent and their fossil fuel use
  by 12 percent on a per vehicle basis.
• Expanded the suite of energy guides available to focus
  industries by  releasing final guides for the food
  processing and glass industries—and drafting an
  energy guide  for petrochemical production, bringing
  the total number of Industry Guides to eight.
• Published guidance for facility-level benchmarking to
  encourage energy efficiency where EPIs have yet to
  be developed.
• Shared best practices across the ENERGY STAR focus
  industries at their  annual meetings, in concert with the
  Association of Energy Engineers'World Energy
  Engineering Congress.
30

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                                                                             ENERGY STAR IN THE INDUSTRIAL SECTOR
       TABLE 12. Summary of EPA's ENERGY STAR Industrial Focuses
FOCUS YEARS
Cement
Manufacturing
Corn Refining
Food Processing
Potato Products
Tomato Products
Glass Manufacturing
Flat Glass Products
Container Glass Products
Motor Vehicle
Manufacturing
Petrochemical
Manufacturing
Petroleum Industry
Pharmaceuticals
Pulp & Paper
Water/Wastewater
4
5
2
New
New
2
New
New
6
1
3
3
1
2
SCOPE PEER INDUSTRY
EXCHANGE ENERGY
OPPORTUNITY GUIDE
75%ofU.S.-based
clinker1* production capacity
95%ofU.S.-based
refining capacity
80% of U.S. processed fruit,
vegetable, and grain sales
50% of U.S. flat, container,
and fiberglass sales
75% of the industry with
U.S. -based production
83% of U.S. ethylene
production capacity
64% of U.S.-based
refining capacity
Over 50% of the global and
U.S. manufacturing capacity
70% of U.S.-based
companies' global sales
40% of the tola I
U.S. population represented
• Complete
• Complete
• In process
• In process
• Complete
• In process
• Complete
• Complete
• In process
• In process
ENERGY
PERFORMANCE
INDICATOR
Final
Final
In process
In process
Final, updating
In draft
Private system
recognized by EPA
In process
Exploring options
In process
        1
         Clinker is the output from a cement kiln.
        "Source: U.S. Census Bureau, December 2006 and 2005.
       TABLE 13. EPA expands ENERGY STAR for superior energy management of industrial plants
SECTOR FACILITY
Cement Plants
Auto Assembly Plants
Petroleum Refineries
Wet Corn Mills
Total Plants Labeled
Total Estimated Energy Savings
(compared with average plants)
LABELS EARNED IN 2007
12
7
7
1
27
59,700,000 mmBtu
TOTAL PLANTS EARNING LABELS SINCE 2006
12
15
7
3
37
77,600,000 mmBtu
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
31

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           Expanding Industrial Partnerships. EPA supports
           partners from a wide variety of industrial sectors. These
           partners have access to energy management resources,
           including the core materials for effective energy
           management available on the  ENERGY STAR Web site,
           communication materials, an active network of energy
           managers, and opportunities for recognition for superior
           energy management. In 2007:

           • The number of ENERGY STAR industrial partners grew
            to almost 480.
           • EPA's  peer exchange network grew by 42 percent.
            The 620 participants, representing more than
            220 organizations, discussed topics such as energy and
            greenhouse gas management, retro commissioning,
            facility assessments, and sub-metering for strategic
            energy management.
           • ENERGY STAR industrial partners continued to support
            consumer awareness of the environmental benefits of
            ENERGY STAR qualified lighting by encouraging
            employees to take the ENERGY  STAR Change a Light,
            Change the l/l/or/cfpledge.

           Recognizing Leadership in  Industrial Energy
           Efficiency. Recognition plays a large part in influencing
           corporate culture change around energy management.
           The ENERGY STAR Partner of the  Year Awards identify the
           industrial leaders and showcase their achievements,
           serving  as an example for other corporations. In 2007, the
           ranks of industrial corporations achieving a high level of
           superior energy management grew to include:

           • Seven ENERGY STAR industrial partners honored for
            Sustained Excellence in Energy Management: 3M,
            California Portland Cement  Company, Ford Motor
            Company, Merck & Co, Inc., PepsiCo, Raytheon
            Company, and Toyota Motor Manufacturing North
            America. Sustained Excellence awardees continually
            challenge their organizations to improve energy
            efficiency and consistently  achieve impressive
            energy savings.
           • Three industrial  partners recognized as ENERGY STAR
            Partner of the Year for the first time: Allergan, Inc.,
            ArcelorMittal USA, and The  Dow Chemical Company.
What to Expect in 2008 and Beyond
Breaking down the market barriers that limit the adoption
of energy efficiency will require outreach to new
industrial  organizations and continued support for
partners. EPA will:

• Continue the Industrial Focuses with the 14
  participating sectors and subsectors. EPA expects to
  finalize two industrial EPIs in 2008—one in the food
  processing industry and another in the glass
  production industry.
• Offer new directions for industrial companies to
  address the risks and costs  associated  with the
  embedded energy of the supplies and services they
  bring into their manufacturing processes in line with
  the recommendations in Energy Strategy for the Road
  Ahead.
• Continue to support peer exchange forums for the
  industrial focus sectors and convene initial meetings
  as new Focuses are formed.
• Expand the system for labeling energy-efficient U.S.-
  based plants with the ENERGY STAR. EPA expects that
  certain  plants engaged in food processing and glass
  manufacturing will be eligible to earn the ENERGY
  STAR by the end of 2008.
• Collaborate with EPA's Laboratories for  the 21st
  Century program to assess using EPA's  energy
  performance rating system to help benchmark
  laboratories.
• Increase the impact of ENERGY STAR in the
  manufacturing sector by completing an agreement
  with the nation's largest industrial trade association,
  the National Association of  Manufacturers (NAM), to
  provide ENERGY STAR resources to NAM's broad
  membership.
• Continue to partner with the Carbon Disclosure Project
  to identify and promote best practices in voluntary
  reporting of climate risks, emissions reduction
  opportunities, and energy management practices to
  financial audiences.
• Recognize excellence in industrial energy management
  through the annual Partner of the Year Awards.
32

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                                                                                   ENERGY STAR IN THE INDUSTRIAL SECTOR
        FIGURE 23. Energy Strategy for the Road Ahead












Energy Strategy
for the Road Ahead
nm
UF Sa<«
Saralo TtwtoiE fat Buaiwsa Bnciitma
2007

GBN Global Business Network


A growing awareness of the impacts of
energy on business and its relationship
to global warming has prompted many
industries to turn to ENERGY STAR
for strategies to manage these risks.
Through ENERGY STAR, EPA set out
to identify the key strategies
corporations must implement now to
prepare for the future of energy. EPA
... ... . ,.
leading companies and the strategy consultancy Global Business
Network. A year of work resulted in the 2007 release of a
transformative report, Energy Strategy for the Road Ahead — Scenario
Thinking for Business Executives and Corporate Boards*



Key Strategies


1 . Master the fundamentals of energy efficiency by creating a
strong energy management program empowered across the
organization and supported by senior executives. ENERGY
STAR resources provide the guidance to do this.
Transformative thinking: Understand that energy efficiency is
the best hedge against future price or availability risks.
2. Take a longer and broader view of investments and strategic

decisions about energy.
Transformative thinking: Value energy
in terms of corporate productivity, placing energy on equal
footing with labor, material, capital, and other operational
expenses. View energy projects over the long-term because they
carry some of the more attractive returns and lowest risk.



3. Search out business transformation opportunities in the way

the company manages,
Drocures, and uses energy.
Transformative thinking: View energy as a lever for positive
growth and change within the business, not simply as a
Energy To-Do List
Of one thing we can be sure: energy will be more challenging and
more important in the future. Will you, and your business, be ready?

What Executives, Senior Managers, and
Board Members Can Do:
Manage energy actively from your position.
LJ Empower energy staff to fulfill the fundamentals.

Q Push for strong energy efficiency from all parts of the business.
Q Enable energy investments by valuing them differently from
other projects.
1 — 1 Educate customers on the value of energy performance in products.
LTI Involve yourself.

Make strategic energy management a Board-level issue.
CH Are you a member of the Board of another corporation?
Q Can you influence the corporation to examine its energy and
climate strategy?
Q Is the corporation practicing strategic energy management?
Influence your industry.
D.
Do you participate in industry associations?
LJ Can you initiate and lead discussions among your industry
counterparts on why strategic energy management is important?
Use scenario thinking in your ongoing strategic discussions.
1 — 1 Wind-tunnel your current energy and climate strategy in these
scenarios.

LJ Connect energy and climate strategy with broader company
programs, goals, and strategies.
feedstock, facilitator of a service, or cost to manage. Evaluate and













potentially redesign how products and services are offered.


4. Prepare contingency strategies tor emerging future scenarios.
Transformative thinking: Continue to consider how the
future may unfold and actively manage for exposure to these
potential risks.

5 . Take personal action. Corporate leaders — individually, in
companies, on boards, and across industries — set the tone for
a corporation and must actively manage energy from their


positions. Transformative thinking: Empower staff to fulfill
the fundamentals, push for efficiency, enable energy investments by
valuing them differently from other projects, and educate customers


PARTICIPATING COMPANIES
California Portland Cement Mercury Marine
Cascade Engineering Mittal Steel
CEMEX National Starch & Chemical
Dow Chemical Owens Corning
Eastman Chemical PepsiCo / Frito-Lay
Genentech PPG Industries
General Motors Proctor & Gamble
HSBC Shell NA
Jones Lang LaSalle Toyota NA
Merck & Co. UPS

on the value of energy performance in products and services.
        * Energy Strategy for the Road Ahead may be downloaded at www.energystar.gov/energystrategy.





ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
33

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      CLIMATE CHOICE
34
           In managing the ENERGY STAR program over the past 15
           years, EPA has gained significant experience in identifying
           and dismantling market barriers that inhibit the adoption
           of commercially proven, cost-effective energy-efficient
           technologies. When considering  emerging technologies,
           EPA recognizes their tremendous potential to reduce
           greenhouse gas emissions. To gain wider use, these
           cutting edge technologies must also face and overcome
           significant barriers, such as a lack of awareness and long
           payback periods.

           To help overcome the unique barriers facing emerging
           technologies and accelerate their widespread adoption,
           EPA launched a new climate technology initiative in 2007
           called Climate Choice. It focuses on technologies that:

           • Are commercially available but not yet widely adopted.
           • Have demonstrated  environmental performance.
           • Have the potential to significantly reduce greenhouse
            gas emissions across the marketplace at competitive
            costs in the future.

           Climate Choice is designed to target the early technology
           adopters and consumers looking for green options (see
           Figure 24). They are often eager and able to take additional
           steps to protect the environment beyond those taken by
           mainstream consumers who depend on the ENERGY STAR
           label to guide their purchasing decisions of energy-efficient
           products.

           Building on EPA's experience in facilitating technology
           adoption, Climate Choice can offer selected emerging
           technologies the following assistance:

           • Recognition. To promote consumer awareness and
            provide objective  information in the marketplace, EPA
            will feature selected emerging technologies on the
            Climate Choice Web site, and offer other recognition
            opportunities.
           • Tailored technology assistance. EPA will work with
            program stakeholders to develop a coordinated
            technology adoption plan that identifies barriers to
            wider technology deployment  and ways EPA can
            address them. The plan will also identify opportunities
            for information sharing through existing ENERGY STAR
            networks and the Climate Leaders peer exchange.
           • ENERGY STAR candidate development. The Climate
            Choice  coordinated  technology adoption plan will
  identify key milestones each technology must reach to
  become a candidate for certification under the
  ENERGY STAR program, if appropriate.

Achievements in 2007
In 2007, EPA and its stakeholders took the first steps to
identify how EPA could effectively address the unique
market barriers facing climate-friendly emerging
technologies,  including:

• Publishing a proposal for the Climate Choice climate
  technology initiative and soliciting and incorporating
  public  comments.
• Hosting the  Climate Technology Initiative Conference
  in October 2007, which brought together more than
  70 experts from government, industry, and nongovernmental
  organizations (NGOs) to make recommendations on
  EPA's efforts for promoting emerging climate protection
  technologies and defining criteria for the Climate Choice
  pilot program (see Table 14).
• Adopting criteria for the  Climate Choice pilot program.
  As an outcome of the conference, EPA adopted the pilot
  program criteria  recommended by the  conference
  attendees and other stakeholders. To qualify for
  participation in the Climate Choice pilot program,
  emerging technologies must:
  1. Be commercially available but not widely adopted
    (< 5% market share).
  2. Preferably be offered by more than one supplier.
  3. Have verified environmental performance.
  4. Be likely to significantly reduce greenhouse gas
    emissions at the sector level at competitive costs.
  5. Have capable  business partners and be
    adequately financed.
  6. Be matched to EPA core competencies.
  7. Have no unacceptable environmental trade-offs.

What to Expect in 2008 and Beyond
In 2008, EPA will continue to collaborate  with its
stakeholders in the roll out of the Climate Choice program.
Major program milestones include launching the Climate
Choice Web site, selecting three pilot technologies,
developing and implementing coordinated technology
adoption plans for  pilot technologies, continuing to refine
program criteria, and establishing a formal technology
nomination and selection process.

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                                                                                                                   CLIMATE CHOICE
         FIGURE 24. Climate Choice targets early adopters and environmentally motivated consumers*
             ET PROGRAMS
             (Screening)


             INNOVATORS
EE PROGRAMS
(Deployment & Dissemination)
            CODES & STANDARDS
            (Federal & State)
                                       EARLY
                                     ADOPTERS
             EARLY
           MAJORITY
  LATE
MAJORITY
                                                                                                          LAGGARDS
                                        ENERGY-EFFICIENT TECHNOLOGIES COMMERCIALIZATION PROCESS
         "Figure adapted from the California Energy Commission
        TABLE 14. Findings of the Climate Technology Initiative Conference

        The EPA Climate Technology Initiative Conference brought together more than 70 experts from government, industry, and NGOs to provide

        guidance for EPA in facilitating the adoption of emerging climate protection technologies. Their findings, approved by consensus, include:
FINDING 1
FINDING 2
FINDINGS
FINDING 4
FINDINGS
FINDINGS
Concern for Climate Change Has Created a
Market for New Technology
EPA Can Speed Commercialization of
Environmentally Superior Technology
Understand the Market and the Technology
Vigorously Protect the ENERGY STAR Brand
Develop Unique Recognition Programs for
Emerging Climate Protection Technology
Emerging Climate Protection Technology Can Be
Promoted At Every Stage of Development

FINDING?
FINDINGS
FINDINGS
FINDING 10
FINDING 11
EPA Will Want To Concentrate on Technologies
Within Its Core Competencies
EPA Needs Partners to Complement &
Supplement Its Core Competencies
A Portfolio Approach Can Support Multiple
Products at Different Stages
Pilot Projects Must Be Strategically Selected
and Agilely Pursued
EPA Can Help Define New Product Carbon
Performance Standards
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                                                     35

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     CLEAN  ENERGY SUPPLY  PROGRAMS
               I POWER
               I PARTNERSHIP
Since 2001, EPA's Clean Energy Supply Programs, which
include the Green Power Partnership (GPP) and the
Combined Heat and Power (CHP) Partnership, have made
tremendous progress in facilitating the explosive growth
of green electricity generation and environmentally
beneficial CHP across the country. Both programs work to
dismantle market barriers and provide cost-effective
solutions for their hundreds of partners by offering
technical resources, credible benchmarks, access to
expertise, and recognition for environmental leadership.
The investments in clean energy made by EPA's partners
result in environmental benefits for all, namely the
reduction of greenhouse  gas emissions and criteria
pollutants. Achievements have been impressive; in 2007
alone, EPA's Clean Energy Supply programs reduced
greenhouse gas emissions by 4.8 MMTCE (see Table 15).


Green Power Partnership
                   Purchasing electricity generated
                      green power resources
                         EPA's Green Power
Partnership offers organizations an easy and  attractive
way to reduce the environmental impact of their
operations, hedge against volatile energy prices, increase
employee and stakeholder morale, and demonstrate
environmental leadership. The commitments of new and
existing program partners—who range in size from
Fortune 500 corporations to  neighborhood businesses,
large public  universities to small private colleges, local
communities to city, state, and federal government
agencies—made 2007 a banner year for the Green Power
Partnership.

In 2007, the Green Power Partnership:
• Added 250 new partners, increasing the total number
  of partners to more than 850. These organizations have
  committed to buying more than 11.5 billion  kWh
  annually of green power—an increase of almost two-
  thirds over 2006 and enough to run nearly 1.2 million
  average American homes for one year (see Figure  25).
• Recognized the participants in EPA's Fortune 500 Green
  Power Challenge, a year-long initiative focused on
  doubling the collective green power purchases of
  eligible Fortune 500 corporations to exceed 5 billion
  kWh annually (see sidebar on p. 38). GPP partners
  surpassed the goal, buying more than 6 billion kWh of
  green power. Among the Challenge participants were
  Intel Corporation, PepsiCo, Wells Fargo & Company,
  Whole Foods Market, The Pepsi Bottling Group, Inc.,
  Johnson & Johnson, Cisco Systems, Inc., Kohl's
  Department Stores, Starbucks, and DuPont Company.
•Acknowledged participating partners in EPA's College
  & University Green Power Challenge, which concluded
  in April 2007. EPA ranked individual school's purchases
  of green power against others within their athletic
  conference and calculated cumulative purchase
  amounts between competing athletic conferences.
• Presented 17 Green Power Leadership Awards to top
  purchasers of green power and onsite renewable
  power systems (see Table 16).
• Launched the Green Power Communities initiative,
  recognizing the collective action of local government,
  business, and citizens in buying green power through
  community organized campaigns. By the end of 2007,
  10 communities across the nation had met EPA Green
  Power Community purchase requirements.

Combined Heat and Power  Partnership
                       Partnership seeks to reduce
                                                                •gjjj CHP
                                                                    COMBINED HEAT AND  th e en vi ro nmenta I impact of power
                                                                    POWER PARTNERSHIP
                                                                                generation by promoting the use of
                                                                combined heat and power as an efficient, clean, and
                                                                reliable approach to generating power and thermal
                                                                energy from a single fuel source. CHP projects are up to
                                                                25 percent more efficient than traditional separate heat
                                                                and power generation.12 The Partnership works closely
                                                                with energy users, the CHP  industry, state and local
                                                                governments, and other stakeholders to support the
                                                                development of new projects and promote their energy,
                                                                environmental, and economic benefits. The program is
                                                                playing a vital role in efforts to achieve the national goal
                                                                of doubling the capacity of CHP in the United States to
                                                                92 gigawatts (GW) by 2010.

                                                                In 2007, the CHP Partnership:
                                                                • Added 33  new partners for a total of 233 and
                                                                  assisted in the deployment of more than 850 MW of
                                                                  new CHP nationwide, bringing the cumulative impact
                                                                  of the program to over 4,450 MW of new CHP (see
                                                                  Figure 26, p. 39).
36
            For more information, see www.epa.gov/chp/basic/efficiency.html

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                                                                               CLEAN ENERGY SUPPLY PROGRAMS
       FIGURE 25. Green Power purchases and avoided greenhouse gas (GHG) emissions almost doubled in 2007
                                  2002
2003
2004
2005
2006
2007
       TABLE 15. Greenhouse gas emissions avoided by EPA's Clean Energy Supply Programs (MMTCE)

Clean Energy
Supply Programs

0.6

1.0

2.0

3.2

3.7

4.8
       TABLE 16. EPA recognizes 17 leading Green Power partners in 2007
ONSITE GENERATION
City of Chico
Chico, CA

Macy's, Inc. West
Division
San Francisco, CA
The Timberland Company
Stratham, NH

GREEN POWER PURCHASING
Kohl's Department Stores
Menomonee Falls, I/I//

New York University
New York, NY
Pepsi Bottling Ventures
Raleigh, NC
PepsiAmericas, Inc.
Schaumburg, IL
Sloan Valve Co. / IL
Manufacturing Facility
Franklin Park, IL

Starbucks
Seattle, WA
The Pepsi Bottling
Group, Inc.
Somers, NY

PARTNER OF THE YEAR
City of Bellingham
Bellingham, WA

Johnson & Johnson
New Brunswick, NJ
Mohawk Fine Papers Inc.
Coftoes, NY
PepsiCo
Purchase, NY
Staples
Framingham, MA

Wells Fargo & Company
San Francisco, CA
Whole Foods Market
Austin, TX


ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                               37

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           • Provided technical assistance to 30 candidate sites
             across the country, including those in the municipal,
             utility, biofuels, industrial, and financial sectors.
           • Provided public support and recognition for highly
             efficient CHP projects, by presenting six ENERGY STAR
             CHP Awards. These winning systems ranged from a
             5 MW system at an ethanol facility to a 15 MW facility
             that supports a large university campus (see Table  17).
           • Collaborated with states, regional organizations, and
             other federal agencies to promote CHP as an efficient
             application for biomass fuels.
           • Offered training and ongoing support to  the air
             regulatory community on the benefits of CHP and
             highlighted opportunities to encourage CHP through
             permitting and other regulatory frameworks.


           What to Expect in 2008 and Beyond
           In 2008, EPA's  clean energy programs will continue to
           dismantle the  market barriers that can stifle investment
           in clean electricity generation and environmentally
           beneficial CHP. In particular, EPA will:
• Expand the Green Power Partnership to achieve its
  goal of reaching more than 16 billion kWh in annual
  green power purchases by year's end and work with
  green power suppliers to increase the supply of
  attractive green power products in the market.
• Aggressively promote the Fortune 500 Green Power
  Challenge to current and prospective Fortune 500
  partners and recognize the winners of the second
  College & University Green Power Challenge.
• Provide assistance in the development of CHP projects
  and expand work with strategic sectors, including the
  dry mill ethanol sector, wastewater treatment facilities,
  and casinos and hotels.  Through the CHP program,
  EPA will also begin outreach to  municipal and
  cooperative utilities to identify CHP opportunities.
• Foster partnerships between rural electricity
  producers and facilities  needing thermal energy for
  mutually beneficial economic and environmental
  projects.
• Reach out to more  states and municipalities and
  provide technical information on other state or local
  energy, environmental, and utility practices that
  encourage environmentally beneficial CHP.
           FORTUNE 500 COMPANIES MEET THE GREEN POWER CHALLENGE


                                    In December 2006, EPA challenged Fortune 500 companies to increase their green power purchases
                                     to more than 5 billion kWh annually through the Fortune 500 Challenge, launched by EPA's Green
                                        Power Partnership. In response, 53 Fortune 500 companies stepped up their commitment to
                                                   environmental stewardship by collectively doubling their annual green power purchases
                                        P~~*  f\ I \  to more than 6 billion kWh. These purchases made 2007 a banner year and helped
                                        *~J J J  avoid the greenhouse gas emissions equivalent to more than 570 million gallons
                                                  of gasoline.

           Leading the charge was Intel, which assumed the Number 1 spot with a purchase of more than 1.3 billion kWh of clean, carbon-free
           green power. The company's purchase is the largest to date among all the Green Power partners, and it alone represents enough electricity
           to power more than 130,000 average American homes each year. PepsiCo is second on EPA's list of Fortune 500 companies, followed by
           Wells Fargo & Company, Whole Foods  Market, The Pepsi Bottling Group, and Johnson & Johnson. Cisco Systems and Kohl's
           Department  Stores recently made sizable purchase increases to put them at seventh and eighth on the list, respectively. Rounding out
           the top 10 green power purchasers are Starbucks and DuPont Company.
38

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                                                                                             CLEAN ENERGY SUPPLY PROGRAMS
        FIGURE 26. Combined heat and power capacity by state as of 2007*
                           WASHINGTON
                                                         Increasing Installed CHP Capacity
                                                         <5MW
                                                                   5-50 MW
                                                                               51-500MW
                                                                                            >500 MW
        *AII data are self-reported; states might have more capacity than reported or shown.
        TABLE 17. 2007 ENERGY STAR Combined Heat and Power Awards
          Adkins Energy CHP System
          Adkins Energy, LLC
          Lena, IL

          Arizona State University CHP System
          Arizona State University
          Tempe, AZ

          Kent State University Cogeneration Plant
          Kent State University
          Kent, OH
Macon Energy Center CHP Project
Macon Municipal Utilities and Northeast Missouri Grain, LLC
Macon, MO

Princeton University Energy Plant
Princeton University
Princeton, NJ

University of New Mexico CHP Project
University of New Mexico
Albuquerque, NM
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                      39

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     STATE AND  LOCAL  PROGRAMS  AND  INITIATIVES
           Clean Energy Environment
           STATE PARTNERSHIP
           Clean EnergyEnvlronment
           MUNICIPAL NETWORK
                  EPA supports the states and
                  localities that are developing
                  initiatives aimed at providing an
                  increasingly clean, renewable, and
                  efficient supply of energy. EPA
                  assists their development and
                  deployment of emerging technologies
                  and helps address their need to
                  achieve energy cost savings through
greater end-use efficiency in residential and  commercial
buildings, municipal facilities, and transportation. This
federal assistance is important to state and local
governments as they address the continuing  challenges of
rising energy demand, rising energy prices, air quality
issues, and global climate change.

The potential impact of state and local policies is
enormous. EPA estimates that if all 50 states implemented
cost-effective clean energy and environment policies, the
projected growth in demand for electricity could be cut in
half by 2025. The additional remaining increase in demand
could be met with cleaner energy supplies. This  translates
into a projected annual savings  of $70 billion  in energy
costs by 2025—avoiding the need for more than  300
power plants and  preventing the greenhouse gas
emissions equivalent to those from 80 million vehicles.

EPA's Clean Energy-Environment state and local  programs
assist state and municipal governments in their clean
energy efforts by providing technical assistance,
analytical tools, and outreach support. Specific
assistance includes:

• Identifying  and documenting cost-effective policies
  and initiatives that promote renewable energy, energy
  efficiency, and related clean energy technologies.
• Providing tools and guidance that help state and local
  governments measure and evaluate  the environmental,
  economic, and public health benefits of clean energy
  initiatives (see Figure 27).
• Offering a suite  of national voluntary programs that
  provide partners with assistance and recognition for
  their clean energy actions.
• Fostering peer-exchange opportunities for state and
  local officials to share information on best practices and
  innovative policies.
EPA also provides technical assistance to public utility
commissions that are exploring options to reduce the
regulatory barriers to adopting comprehensive energy
efficiency, renewable energy, and combined heat and
power programs in their states.

Clean Energy-Environment State
Partnership

In 2007,  EPA assisted state governments by:
• Expanding the focus of support from a targeted group
  of state partners to a comprehensive nationwide
  program to help all states learn from the experiences
  gained through the partnership.
• Adding  Hawaii to the State Partnership program,
  bringing the total to 15 partners.
• Supporting states as they analyzed clean energy
  options  and prioritized policies of interest, developed
  and implemented programs, and identified additional
  guidance and technical assistance from EPA that
  would be helpful in the coming years (see Table 18).
• Conducting eight peer exchange sessions through the
  EPA Clean Energy-Environment Technical Forum—
  involving a total of more than 200 state environmental,
  energy,  and utility regulatory officials from over 35
  states—to examine best practices on topics such as
  renewable energy credits, state energy planning, high-
  performance buildings, and clean distributed
  generation.


Clean Energy-Environment Municipal
Network

In 2007,  EPA assisted local governments by:
• Expanding the Clean Energy-Environment Municipal
  Network—a complementary program to the Clean
  Energy-Environment State Program—to provide one-
  stop access to the wealth  of EPA programs that offer
  technical assistance or resources to local governments.
• Developing an online, searchable database of
  resources to help local governments assess clean
  energy  policies and programs.
• Providing support to Dallas, TX, and Philadelphia, PA,
  for their urban heat island efforts through activities
40

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                                                                                     STATE AND  LOCAL PROGRAMS AND  INITIATIVES
         Figure 27. Tools and resources for states
             eGRID
EPA's State Greenhouse Gas Inventory and Projection Tool:
Based upon IPCC and the U.S. National Greenhouse Gas
Inventory methods, this user-friendly tool helps states develop state-
level greenhouse gas inventories and project future emissions.
http://epa.gov/climatechange/emissions/state_guidance.html
                       E-Grid: A comprehensive source of data
                       on the environmental characteristics of
                       U.S. power generation at various levels
of aggregation. Links electricity generation, air emissions, and
resource mix. http://www.epa.gov/cleanenergy/egrid/index.htm
                     Clean Energy-Environment Guide to
                     Action: Policies,  Best Practices, and Action
                     Steps for States: 16 best practices states
                     have found to cost-effectively advance clean
                     energy and other environmental goals.
                     http://epa.gov/cleanenergy/stateand
                     local/guidetoaction.htm
State Climate Change Mitigation Actions: Maps and tables
summarizing state programs, initiatives, and policies to promote
clean energy and reduce greenhouse gases.
http://epa.gov/climatechange/wycd /stateandlocalgov/state_
actionslist.html
EPA's Greenhouse Gas Equivalency Calculator: A Web-based
calculator that enables organizations and individuals to quickly and
easily translate greenhouse gas reductions from units typically
used to report reductions into terms that are easier to
conceptualize (e.g., passenger cars not driven for one year).
http://epa.gov/cleanenergy/ energy-resources/calculator.html
         TABLE 18. Clean Energy-Environment State Partnership grows to 15 partners in 2007
STATE CLEAN ENERGY-ENVIRONMENT ACTIONS
Energy Efficiency Savings Goals in Public Facilities
Energy-Efficient Appliance and Equipment
Purchase Requirements for Public Facilities
Renewable Energy Goals for Public Facilities
State & Regional Energy Planning
Energy Efficiency Portfolio Standards
Public Benefit Funds for Energy Efficiency
Commercial Energy Efficiency Building Codes
Residential Energy Efficiency Building Codes
State Appliance Energy Efficiency Standards
Renewable Portfolio Standards
Public Benefit Funds for Renewable Energy
Output-Based Environmental Regulation To
Support Clean Energy
Clean Distributed Generation
Net Metering
PARTNERS WITH NEW
PROGRAMS IN 2007
10
4
5
1
3
1
2
2
0
1
1
0
0
0
TOTAL PARTNERS
WITH PROGRAMS
14
11
9
15
10
10
12
12
5
12
10
7
13
15
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                                                                                            41

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             such as quarterly Webcast training sessions on how to
             reduce urban heat islands.
           • Forming a Transportation Research Board
             Subcommittee on Pavements and the Urban Climate to
             help advance research on and understanding of cool
             pavement technologies and policies.


           What to Expect in 2008 and Beyond
           EPA will continue to support state and local governments
           as they develop, implement, and refine their clean
           energy and  climate protection activities. Specifically,
           EPA will:
           • Add one additional state partner, bringing the total
             number of partners in the State Partnership program to
             16 in 2008, and provide resources to additional states
             across the country.
           • Expand the real time, online information about state
             clean energy and climate policies as well as best practices.


           Clean Energy and Utility Policy Programs
                        Despite the proven economic and
                        environmental benefits of energy
                        efficiency, a range of barriers have
                        hindered utilities and others from  making
                        greater investments in these cost-effective
                        measures. EPA continues to provide state
                        public utility commissions and others with
                        tools and resources for exploring and
                        implementing policies that will reduce the
           barriers to adopting comprehensive energy efficiency,
           renewable energy, and combined heat and power
           programs at the state and local level.

           In 2007, EPA:
           • Co-facilitated the National Action Plan for Energy
             Efficiency (Action Plan) with DOE. This effort brings
             together a Leadership Group of more than 60 top
             utilities, utility regulators, state agencies, large energy
             users, consumer advocates, energy service providers,
             and environmental and energy efficiency
             organizations.  During its first 2 years, the Leadership
             Group reviewed and identified the barriers limiting
             greater investment in cost-effective energy efficiency,
             developed five key policy recommendations for
             increasing investment in energy efficiency, and
             presented a suite of resources to help committed
             organizations implement the recommendations.
             Through 2007,120 organizations across 49 states had
National
Action
Plan for
Energy
Efficiency
  made commitments to advance energy efficiency
  through the Action Plan (see Table 19).
•Released Vision for 2025: Developing a Framework for
  Change, which offers a framework for state-specific
  policies and programs to overcome barriers and
  enable the acquisition of all cost-effective energy
  efficiency potential by 2025. The Vision for 2025
  identifies 10 implementation goals for states to consider
  in order to help them achieve energy efficiency
  improvements by the year 2025 (see Table 20).
• Continued to provide technical assistance to states
  through the EPA-State Energy Efficiency Renewable
  Energy Pilots, including New Mexico, Florida, and
  Maryland.
• Provided policy assistance about the electric sector to
  states developing rules and policies that will accelerate
  the deployment of customer-sited clean distributed
  generation, including Hawaii, Florida, Maryland, and
  South Dakota.

What to Expect in 2008 and Beyond
EPA will continue to assist interested state public utility
commissions in their efforts to advance clean  energy  by
sharing information on how other states have  removed
barriers and pursued best practice policies and programs.
EPA will also continue to facilitate the Action Plan in
conjunction with DOE. In its third year, the Action Plan
will focus on outreach and education, measuring
progress toward the  Vision for 2025, and developing
additional educational resources. These new resources
will address:

• The role of energy efficiency as a  low-cost strategy for
  reducing carbon emissions.
• Coordinating demand response and energy efficiency
  policies and programs.
• Defining cost-effectiveness of energy efficiency
  programs.
• Advancing building energy codes through energy
  efficiency programs.
• Energy efficiency design and implementation best
  practices.
• Customer incentives for energy efficiency.
• Availability of energy bill  data to customers.
• Designing and implementing state and local lead-by-
  example programs.
42

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                                                                          STATE AND LOCAL PROGRAMS AND INITIATIVES
        TABLE 19.120 organizations have made commitments under the National Action Plan for Energy Efficiency
TYPE OF COMMITMENT
Establishing and supporting state-level collaborative processes
to explore how best to increase investment in energy efficiency
Investing additional money in energy efficiency programs
Starting new and/or expanding existing energy efficiency programs
Exploring policies and practices to align utility incentives with
the delivery of cost-effective energy efficiency
Advancing efforts to include energy efficiency on a consistent and
comparable basis with supply-side resources in future resource
planning activities
Meeting aggressive energy savings goals
Proactively educating stakeholders on the benefits of and
opportunities for energy efficiency
NUMBER OF ORGANIZATIONS MAKING A
COMMITMENT UNDER THIS RECOMMENDATION*
15
4
17
5
24
26
68
        * See the Action Plan Web site lwww.epa.gov/eeactionplanl for a full listing of energy efficiency commitments.
        TABLE 20. Resources available in support of the Action Plan's Vision for 2025 goals
VISION FOR 2025 GOALS
GOAL ONE
Establishing Cost-Effective Energy
Efficiency as a High-Priority Resource
GOAL TWO
Developing Processes To Align
Utility Incentives Equally for
Efficiency and Supply Resources
GOAL THREE
Establishing Cost-Effectiveness Tests
GOAL FOUR
Establishing Evaluation, Measurement,
and Verification Mechanisms
GOAL FIVE
Establishing Effective Energy Efficiency
Delivery Mechanisms
GOAL SIX
Developing State Policies To Ensure
Robust Energy Efficiency Practices
GOAL SEVEN
Aligning Customer Pricing and
Incentives To Encourage Investment in
Energy Efficiency
GOAL EIGHT
Establishing State of the Art
Billing Systems
GOAL NINE
Implementing State of the Art Efficiency
Information Sharing and Delivery Systems
INTRODUCTION TO
ISSUES IN JULY 2006
ACTION PLAN REPORT

—
	
	
	


•
•
•
•
•

•


ACTION PLAN TOOLS AND RESOURCES
• Guide to Resource Planning with Energy Efficiency
• Guide for Conducting Energy Efficiency Potential Studies
• Communications Kit
•Aligning Utility Incentives with Investment in
Energy Efficiency Paper
• Guide to Resource Planning with Energy Efficiency
• Guide for Conducting Energy Efficiency Potential Studies
• Model Energy Efficiency Program Impact Evaluation Guide
• Regional Implementation Meetings
• Resources Database
• Building Codes for Energy Efficiency Fact Sheet

• Sector Collaborative on Energy Efficiency
• Paper on Coordination of Demand Response and Energy
Efficiency (under development)
GOAL TEN
Implementing Advanced Technologies
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
43

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      METHANE  PROGRAMS
           Methane (CH4) is both a potent greenhouse gas—over
           20 times more effective than C02 at trapping heat in
           the atmosphere—and a valuable energy resource (see
           Table 21). Methane emissions from sources including
           agriculture, landfills, coal mines, and oil and natural gas
           systems currently represent about 7 percent of total
           U.S. greenhouse gas emissions. The recovery and
           utilization of methane as an energy source offers
           substantial opportunities for cost-effective greenhouse
           gas emissions reductions that deliver significant economic,
           environmental, and energy benefits.

           For more than a decade, EPA has managed a suite of
           partnership and outreach programs designed to reduce
           emissions of methane by removing the market barriers
           that discourage investment in its recovery and use as an
           energy resource. All of these programs, including the
           Natural Gas  STAR Program, AgSTAR, the Coalbed
           Methane Outreach Program, and the Landfill Methane
           Outreach Program, follow  a successful strategy: they
           provide reliable and comprehensive technical, economic,
           and  policy information to facilitate the adoption of cost-
           effective emissions reduction technologies and practices.
           These programs also offer tools and targeted technical
           assistance to help both public and private sector partners
           implement methane reduction project opportunities.
           Partners can gain a competitive advantage by improving
           their operating efficiency and receive recognition from
           EPA for their leadership in reducing methane emissions.

           In 2007, the methane programs saved  a combined
           17.4 MMTCE, an increase of more  than 85 percent
           since 2000 (see Table 22). These climate partnerships,
           in conjunction with a regulatory program to limit air
           emissions from the nation's largest landfills, have
           reduced national methane emissions to 11  percent
           below 1990 levels. They are projected to remain below
           1990 levels through at least 2012 (see Figure 28).

           Building off this success in the United States, EPA is now
           leveraging its experience and expertise to  achieve
           economic and  environmental results on a global scale.
           The  Methane to Markets Partnership works to advance
           the recovery and use of methane as a clean energy
           source (see Figure 32, p. 51 ). Since its launch in 2004 with
           14 partner countries, the Partnership has grown
           substantially to include 27  partner  governments and more
           than 800 public and private sector organizations.
Natural Gas STAR Program
                   :ral Gas STAR is a partnership
                    between EPA and the U.S. natural
                   gas industry designed to overcome
                   arriers to the adoption of cost-
                 effective technologies and practices
that reduce methane emissions. Initiated in 1993, Natural
Gas STAR partners with companies from all sectors of the
natural gas supply chain—production, processing,
transmission, and distribution—to reduce gas losses,
improve system efficiency, and ensure that more gas  gets
to market. EPA has developed  a range of tools and
resources to help partners implement a wide range of
cost-effective  methane reduction  best management
practices and  technologies.

In 2007, Natural Gas STAR:
• Reduced  methane  emissions by 10.2 MMTCE and
  achieved cumulative reductions of more than
  75 MMTCE since 1990 (see Figure 29, p. 47).
• Maintained  62 percent industry participation across all
  major sectors—production, processing, transmission,
  and distribution.
• Partnered with nine new companies, bringing the total
  number of partners to more than 120.
• Collaborated with eight Natural Gas STAR International
  partners to develop Program Implementation Plans and
  identify and  prioritize methane mitigation opportunities.
• Conducted six onsite and three online technology
  transfer workshops covering the four major gas
  sectors, each of which provided an excellent forum for
  company representatives and industry experts to
  receive and share  information on current cost-
  effective technologies and practices for reducing
  methane emissions.
• Recognized  10 partner companies for significant
  corporate achievements in reducing methane
  emissions from oil  and gas systems at the
  14th Annual Implementation Workshop in
  Houston, TX (see Table 23, p. 47).
44

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                                                                                              METHANE PROGRAMS
       TABLE 21. Global warming potentials (GWPs) and atmospheric lifetimes of greenhouse gases
GREENHOUSE GAS
Carbon Dioxide
Methane
Nitrous Oxide
Hydrofluorocarbons
HFC-134a
Perfluorocarbons
Sulfur Hexafluoride
GLOBAL WARMING
POTENTIAL FOR 100 YEARS
1
21
310
140-11,700
1,300
6,500-9,200
23,900
ATMOSPHERIC
FETIME (YEARS)
50-200
12±3
120
1.5-264
14
3,200-50,000
3,200
       Source: IPCC 1996
       TABLE 22. EPA's Methane Programs meet and surpass goals
PROGRAM
NATURAL GAS STAR
Industry Participation (% in program)
Annual Gas Savings (MMTCE)
COALBED METHANE OUTREACH PROGRAM
Annual Methane Reductions (MMTCE)
LANDFILL METHANE OUTREACH PROGRAM
Number of Projects
Annual Methane Reductions (MMTCE)
TOTAL REDUCTIONS (MMTCE)
2007 GOAL

59%
6.7

2.0

329
5.2
13.9
2007 ACHIEVEMENT

62%
10.2

2.0

360
5.2
17.4


60%
7.0

2.2

349
5.5
14.7
       FIGURE 28. Partner actions are projected to maintain methane emissions below 1990 levels through 2012
              1990
1995
2000
2005
2010
2012
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                                                45

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46
           What to Expect in 2008 and Beyond
           EPA will continue to support Gas STAR partners in the
           following ways as they implement programs to reduce
           their methane emissions:
           • Develop additional tools and resources that highlight
             the environmental and economic benefits of methane
             reductions and  facilitate company implementation of
             emissions reduction projects.
           • Provide one-on-one assistance to partners in
             identifying  and  prioritizing new, cost-effective
             opportunities to further reduce methane emissions.
           • Conduct six onsite and six Web-based technology
             transfer workshops, and expand the Annual
             Implementation  Workshop to include  a broader
             international focus.
           • Conduct measurement studies and technology transfer
             workshops at oil and gas operations  globally to assess
             key emissions sources and identify potential mitigation
             measures, as well as to provide critical technical
             training in leak detection and quantification methods.


           AgSTAR Program
                            Through the AgSTAR Program, EPA,
                            the U.S. Department of Agriculture
                            (USDA), and DOE collaborate with the
                            nation's agriculture industry to reduce
                            methane emissions by promoting the
           use of anaerobic digesters and biogas  recovery systems
           to manage animal wastes. EPA provides technical
           information and tools to help implement systems and assess
           potential projects. In addition to avoiding greenhouse gas
           emissions, the technologies and practices encouraged
           through AgSTAR reduce local water and air pollution and
           generate renewable energy that improves farm revenues.
           Currently, there are nearly 200 operating or planned
           systems in the United States.

           In 2007, AgSTAR:
           • Assisted livestock producers in project planning and
             implementation that, when completed, will produce
             nearly 275 million kWh/year of renewable energy from
             farms capturing methane. This energy will then be
             used by the farms and local communities.
           • Continued to expand methane-reducing technologies
             in the livestock  sector to help ensure clean water and
             air and held events with local extension services to
             market these opportunities. These activities took place
             as part of the implementation of Section 9006 of the
             Farm Bill.
• Developed and updated several important project
  implementation tools and resources, including the
  AgSTAR industry directory and the FarmWare project
  development software.

What to Expect in 2008 and Beyond
In 2008, AgSTAR will:
• Formalize collaboration with state energy programs
  across the country to facilitate the development of
  anaerobic digestion systems as renewable energy
  sources.
• Host the fourth annual national conference to provide
  environmental, program, market, state-of-the-art
  technical, and funding information on anaerobic
  digestion  systems.
• Deliver state and regional workshops to educate
  livestock  producers and promote anaerobic digestion
  systems, in collaboration with USDA and state  energy
  programs.
• Continue to develop a national database to house
  information on current and  pending anaerobic digestion
  systems.


Coalbed  Methane Outreach Program
               The  Coalbed Methane Outreach Program
fc.EPAj«^%   (CMOP) collaborates with coal
Coalbed Methane   companies and related industries to
\^yoU™«cH«oo.»M   reduce methane emissions from coal
mines through the development of environmentally
beneficial, cost-effective coal mine methane (CMM)
recovery and utilization projects. CMOP efforts focus on
mitigating emissions  from degasification systems at
underground coal mines and  underground mine
ventilation systems. The  program provides high-quality,
project-specific information and technical assistance to
the coal mining industry and project developers. These
efforts include analyses of technologies and potential
projects, technology  demonstrations, mine-specific
project feasibility assessments, state-specific  analyses of
project potential, market evaluations, and guides to state,
local, and federal assistance  programs.

As a  result of EPA's successful collaboration with  coal
companies and specialized businesses, the percentage of
drained coal mine methane that is recovered and  used
has grown from 25 percent in the early 1990s to more than
80 percent in 2007. To capture the remaining methane
emitted from degasification systems, EPA is working with
industry to use CMM for injection in natural gas pipelines

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                                                                                                METHANE PROGRAMS
        FIGURE 29. Natural Gas STAR cumulative greenhouse gas emissions reductions and gas savings
              DC

              CO
              CO

              CD

              <
              la
              LLJ CO
              > z
                 =
              is
              u oc
                       800-
                             2000
2001
2002     2003    2004     2005
2006
2007
       TABLE 23. 2007 Natural Gas STAR Awards
         PRODUCTION PARTNER OFTHEYEAR
         EnCana Oil & Gas Inc. (USA)
         Calgary, Alberta

         PROCESSING PARTNER OFTHEYEAR
         Enbridge Energy Partners, Inc.
         Houston, TX

         TRANSMISSION PARTNER OFTHEYEAR
         Columbia Gas Transmission Corporation
         Houston, TX

         DISTRIBUTION PARTNER OFTHEYEAR
         Alliant Energy
         Madison, I/I//
       CONTINUING EXCELLENCE (12 YEARS)
       Chevron Corporation
       San Ramon, CA

       Great Lakes Gas Transmission Company
       Troy, Ml

       CONTINUING EXCELLENCE (10 YEARS)
       Consumers Energy
       Jackson, Ml

       Southwest Gas Corporation
       Las Vegas, NV
                                  CONTINUING EXCELLENCE (5 YEARS)
                                  Northern Natural Gas Company
                                  Omaha, NE

                                  ROOKIE OFTHEYEAR
                                  Southwestern Energy Company
                                  Houston, TX
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                                            47

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           (with or without upgrading, as needed), in power generation,
           and for mine heating and coal drying. EPA is also
           expanding its focus to include the methane emitted from
           coal mine ventilation systems and from abandoned
           underground  mines. Mine ventilation systems account for
           80 billion cubic feet (Bcf) of U.S. methane emissions
           annually, or more than 50 percent of U.S. CMM liberated
           in a single year.

           In  2007,  the Coalbed Methane Outreach
           Program:
           • Reduced emissions of methane by an estimated
            2.0 MMTCE. These results include those from about
            20 projects that captured and used methane from
            some 30 closed U.S. coal mines.
           • Worked in cooperation with CONSOL Energy and
            DOE to support the successful commissioning and
            operation of a  technology demonstration project to
            mitigate methane emissions from diluted mine
            ventilation air.  This is the first demonstration of its kind
            in the United States. This test-scale demonstration is
            being conducted at a closed mine in West Virginia to
            simulate active mine conditions.
           • Promoted CMM recovery and utilization at closed
            underground mines and active surface mines by
            developing a database of candidate mines and
            preparing case studies  of successful projects.
           • Organized a national conference to address the
            opportunities and challenges of CMM project
            development in the United States, including site visits
            to coal mine methane recovery and use projects at
            abandoned mines.
           • Engaged with  officials from leading coal mining  and
            end-use application companies.
           • Performed an economic risk analysis for a coal mine
            methane recovery and use project in the western United
            States to assess various end-use options.

           What to Expect in 2008 and  Beyond
           In 2008, the Coalbed Methane Outreach Program will:

           • Launch  tools to assist potential CMM project
            developers, including an online model for project
            finance and economics.
           • Continue supporting the demonstration project on
            ventilation air  methane  mitigation in the United States.
LANDFILL METHANE
OUTREACH PROGRAM
• Update technical reports to provide more accessible
  information about technologies for recovering coal
  mine methane and using it effectively.
• Directly engage project developers, investors,
  technology vendors, and the mining community through
  effective outreach events, including a conference and
  roundtable.


Landfill Methane Outreach Program
                Landfills are the second largest
                anthropogenic source of CH4 emissions
                in the United States, accounting for
                approximately 23 percent of total CH4
                emissions in 2006. To reduce emissions
from this  sector, EPA launched the Landfill Methane
Outreach Program (LMOP) in 1994 to facilitate the
development of landfill gas energy (LFGE) projects. The
program focuses its efforts on smaller landfills not
required by EPA regulations to collect and combust their
landfill gas, as well as larger, regulated  operations that
are combusting their gas but not using it as a clean
energy source. LFGE projects not only prevent the direct
methane  emissions from landfills, but also reduce indirect
C02 emissions by displacing electricity generated from the
burning of fossil fuels (see Figure 30).

Through LMOP, EPA provides landfill owners and
operators a suite of tools and technical resources to  help
them overcome the hurdles to LFGE project development,
including feasibility analyses, decision-making software
for evaluating project economics, a database  of more
than 540 candidate landfills, a project development
handbook, and energy end-user analyses.

Over the past 13 years, LMOP has assisted approximately
360 projects (see Figure 31) that reduced methane
emissions from landfills and avoided C02 emissions
amounting collectively to about 36.0 MMTCE. These
efforts are partially responsible for the 16-percent
decrease in methane emissions from landfills since 1990.

In 2007, the Landfill Methane Outreach
Program:
• Reduced  methane emissions by 5.2 MMTCE by
  assisting  in the development of 30 new LFGE projects
  and  20  project expansions.
• Welcomed 108 new partners, increasing participation
  by 18 percent and bringing the total to more than
  700  LMOP partners.
48

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                                                                                                         METHANE PROGRAMS
        FIGURE 30. Direct use and electric capacity of LMOP-assisted projects
                 250 _
                                  2001
2002
2003
2004
2005
2006
                                                            ._ 1,0000
                                  Direct Use   • Electric Capacity
2007
        FIGURE 31. Landfill gas energy projects across the country

                                                           NORTH DAKOTA
                                                           SOUTH DAKOTA

                                                                                                NORTH CAROLINA
                                                        Increasing Number of Projects Operational in 2007
                                                        <5
                                                                   5-15
                                                                                ////////A
                                                                                16-20          >20
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                                                 49

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          • Provided technical assistance to more than 40 corporations,
            helping them identify opportunities to advance LFGE
            as a reliable, low-cost source of energy. Over the past
            3 years, this technical assistance has included
            performing over 80 cost analyses, conducting 70 locator
            searches used to match end-users and landfills, and
            running  models for 40 landfill gas recovery projects.
          • Highlighted a dozen landfills to attract investment
            opportunities during the 11th Annual LMOP Conference
            and Project Expo. Over 500 people attended the
            conference at which EPA Administrator Stephen L.
            Johnson gave the keynote address.
          • Garnered public attention for LMOP partners and LFGE
            projects, which were featured by numerous media
            outlets, including CNN, The Wall Street Journal, The
            New York Times, and The Boston Globe.
          • Launched several new LMOP partner tools and
            resources: an update to the funding guide, five project
            profiles to highlight the 2007 award recipients, and an
            updated boiler fact sheet.
• Recognized the outstanding accomplishments of four
  landfill methane partners and three exemplary projects
  at the 11th Annual LMOP Conference and Project Expo
  (see Table 24).

What to Expect in 2008 and Beyond
In 2008, the  Landfill Methane Outreach Program will:

• Assist in the development of more than 40 new
  LFGE projects.
• Expand efforts to promote the benefits of LFGE to
  economic development offices, emphasizing job
  creation and tax revenue opportunities for states and
  communities.
• Host the 12th Annual LMOP Conference, Project
  Expo, and Awards Ceremony to showcase the top
  LMOP Partners and projects and discuss the latest
  industry trends.
• Update the LMOP Project Development Handbook
  and Web site.
     FLUORINATED  GAS PROGRAMS
          Many fluorinated gases (F-gases), such as
          perfluorocarbons (PFCs), hydrofluorocarbons (HFCs),
          nitrogen trifluoride (NF3), and sulfur hexafluoride (SF6),
          trap substantially more heat in the atmosphere than does
          C02 on a per mass basis (see Table 21, p. 45). In addition,
          some of these gases can have very long atmospheric
          lifetimes compared with C02. As a result, F-gases possess
          very high global warming potentials (GWPs).

          Emissions of many F-gases occur as byproducts of
          U.S. industrial operations. To develop cost-effective
          operational improvements that will reduce these
          emissions, EPA has worked closely with key industries to
          create and manage a suite of partnership programs.
          Three of these industries are implementing agreements to
          reduce emissions under the President's Climate VISION
          (Voluntary Innovative Sector Initiatives: Opportunities
          Now) plan (see Table 25, p. 53). Despite the potential for
          sizable growth in F-gas emissions, EPA's partner industries
          are expected to maintain their emissions substantially
          below 1990 levels through the year 2012 thanks to the
          emissions reduction strategies developed by EPA's
          partnerships (see Figure 33, p. 53). Greenhouse gas
          emissions reductions across these programs totaled
          13.8 MMTCE in 2007 (see Table 26, p. 53).
The Voluntary Aluminum Industrial
Partnership (VAIP)
                       The Voluntary Aluminum
                       Industry Partnership (VAIP)
                       program was launched in
                       1995 as a joint effort between
EPA and the U.S. primary aluminum industry to reduce
perfluorocarbon (PFC) emissions from aluminum
production. In 2003, the aluminum industry committed to
reducing direct carbon intensity by 53 percent from 1990
levels by 2010 in support of the Climate VISION plan. The
plan involves reducing emissions of perfluoromethane
(CF4) and perfluoroethane (C2F6), which are inadvertent
byproducts of the smelting process, and  reducing C02
emissions caused by the consumption of the carbon
anode. This ambitious goal signifies an additional direct
carbon intensity reduction of 25 percent beyond 2000 levels.

In 2007, the Voluntary Aluminum Industrial
Partnership:
• Reduced 2.5 MMTCE in direct greenhouse gas
  emissions, which represents reduced PFC emissions of
50

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                                                                                                                METHANE PROGRAMS
        TABLE 24. 2007 Landfill Methane Outreach Program Awards
           PROJECT OF THE YEAR
           Greentree Landfill Gas Energy Project
           Kersey, PA
           PROJECT OF THE YEAR
           Iris Glen Landfill Gas Energy Project
           Johnson City, TN
           PROJECT OF THE YEAR
           Southeastern Chester County Refuse Authority (SECCRA)
               Landfill Gas Energy Project
           Chester County, PA
           INDUSTRY PARTNER OF THE YEAR
           Ameresco
           Framingham, MA
                              COMMUNITY PARTNER OF THE YEAR
                              Greater Lebanon Refuse Authority (GLRA) and PPL Energy Landfill
                                  Gas Energy Project
                              Lebanon, PA
                              ENDORSEROFTHEYEAR
                              CIFAL-Atlanta
                              Atlanta, GA
                              ENERGY PARTNERSOFTHEYEAR
                              Alameda Power & Telecom and City of Palo Alto
                              Watsonville, CA
         FIGURE 32. Exporting the success of EPA's domestic Methane Programs: Methane to Markets (M2M)
            Methane to Markets
            GHG reduction potential
            of U.S.-supported projects

                 2005    2006     2007
Launched in 2004, M2M is an international initiative that unites public and private interests to advance
the capture and use of methane as a clean energy source. Building off its domestic methane programs,
EPA is working with 26 national governments, the European Union, and more than 800 private and
public sector organizations to advance methane energy projects in four major areas: agricultural waste,
landfills, underground coal mines, and natural gas and oil systems. U.S. efforts under the M2M
Partnership are led by EPA and involve the collective efforts of six agencies and departments across the
federal government.
In its fourth year, M2M realized significant gains. Ongoing U.S.-supported projects overseas are expected
to result in estimated annual reductions of approximately 24 MMTCO2 (see graph). U.S. contributions
have also leveraged more than $270 million in investment from other partner countries, development
banks, the private sector, and members of the Project Network.
In October 2007, the Partnership held the first Methane to Markets Expo, a forum to share information
on methane project development, technology deployment, financing, and policy, in Beijing, China. This
landmark event, co-sponsored by EPA and China's National Development and Reform Commission,
attracted more than 700 participants from 34 countries. The high level of participation demonstrated
widespread international interest and commitment to a growing public-private  partnership that cuts
potent greenhouse gas emissions, while promoting the use of clean energy. The Expo featured an
"International  Methane  Capture Marketplace," which showcased  91 potential methane capture and use
projects  in the agriculture, coal, landfill, and oil and gas sectors that will deliver significant clean
development and climate change benefits throughout the world. If fully implemented, these projects are
estimated to yield annual methane emissions reductions of 11.5 MMTCO2 by 2015.
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                                                          51

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  more than 75 percent and reduced direct carbon
  emissions of more than 53 percent on a per-ton basis
  compared to the industry's 1990 baseline.
• Completed a Web-based training module, Anode Effect
  Management, for use by pot room operators and
  smelter managers.
• Worked with the International Aluminium Institute (IAI)
  to update the EPA/IAI PFC Measurement Protocol,
  which enables the collection of consistent data from
  smelter-specific PFC measurements being completed
  around the world.
• Organized a PFC ManagementWorkshop in Beijing,
  China, to support the greenhouse gas reduction efforts
  by the Aluminum Task Force of the Asia Pacific
  Partnership for Clean Development and Climate.


HFC-23 Emission Reduction Program
HFC-23 is a byproduct in the production of HCFC-22, a
common commercial and residential air conditioning
refrigerant. Through its partnership with 100 percent of
the U.S. HCFC-22 industry, EPA encourages the
development and implementation of feasible, cost-
effective processing practices and technologies that
reduce HFC-23 emissions. Since the partnership began in
1993, U.S. HCFC-22 manufacturers have made significant
progress in lowering emissions  of HFC-23 through process
optimization and thermal destruction.  As a result, HFC-23
emission intensity has dropped dramatically.13

In 2007, the  HFC-23 Emission Reduction Program:
• Reduced emissions  by 7.0 MMTCE below what they
  would have been had production continued at 1990
  emissions intensity levels.
• Completed, in collaboration with the HCFC-22 producers,
  a comprehensive data audit that reviewed estimates of
  HFC-23 emissions and HCFC-22 production on a plant-
  specific basis from 1990 to 2006.


The PFC  Reduction/Climate  Partnership
for the Semiconductor Industry
                 Since its inception in 1996, this
                 partnership has been a catalyst for
                 semiconductor companies in Europe,
                 Asia, and North America to set the
                 first global industry target for reducing
                                                                 greenhouse gas emissions. Semiconductor manufacturers
                                                                 have worked alongside EPA to identify and implement
                                                                 PFC-reducing process changes and manufacturing tool
                                                                 improvements for the production of integrated circuits. In
                                                                 April 1999, the World Semiconductor Council (WSC)—
                                                                 whose members include the national semiconductor
                                                                 industry associations of Europe, Japan, Korea, Taiwan,
                                                                 and the United States—announced a very challenging
                                                                 goal: to reduce PFC emissions by at least 10 percent
                                                                 below the 1995 baseline level by year-end 2010. The
                                                                 WSC's goal represents the world's  first industry-wide,
                                                                 global greenhouse gas emissions reduction target.

                                                                 The aggressive goal set by WSC demonstrates the
                                                                 semiconductor industry's commitment  to climate
                                                                 protection in the international community. The present
                                                                 challenge for WSC and EPA is to maintain flexibility and
                                                                 leadership when aligning the initiative  with the industry's
                                                                 plan to include emerging production centers in Malaysia
                                                                 and Singapore.

                                                                 In 2007, the PFC Reduction/Climate Partnership
                                                                 for the Semiconductor Industry:
                                                                 • Reduced absolute PFC emissions by 2.4 MMTCE, or
                                                                   more than 75 percent below business-as-usual (BAU)
                                                                   levels, while U.S. manufacturing continued to expand.
                                                                   EPA's semiconductor industry partners are on track to
                                                                   meet their 2010 WSC/Climate VISION commitments.
                                                                 • Worked with partner companies NEC and Qimonda to
                                                                   evaluate installed PFC abatement devices in full-scale
                                                                   production settings. The goals of the studies were to
                                                                   evaluate and validate EPA's proposed standard
                                                                   measurement protocol and to help partners learn how
                                                                   their installed emissions control  technologies operate
                                                                   between periodic maintenance.
                                                                 • Led a collaborative effort to develop a new standard
                                                                   method for characterizing destruction or removal
                                                                   efficiency (ORE) of PFC abatement technologies.
                                                                 • Supported the WSC's negotiation with China to set an
                                                                   aggressive PFC emissions reduction target by
                                                                   developing a model to project China's emissions
                                                                   through 2020 under various goal scenarios.14
52
           13 HFC-23 emission intensity is the amount of HFC-23 emitted per kilogram of HCFC-22 manufactured.
             For more information, see Bartos SC, et al., 2008.

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                                                                                           FLUORINATED GAS PROGRAMS
        TABLE 25. Climate VISION* goals for EPA's Fluorinated Gas Programs
EPA PROGRAM
Voluntary Aluminum Industrial Partnership (VAIP)
The SF6 Emission Reduction
Partnership for the Magnesium Industry
The PFC Reduction/Climate Partnership for the
Semiconductor Industry
CLIMATE VISION GOAL
Has committed to achieving a direct carbon intensity reduction
53% from 1990 levels by 2010.
Has committed to eliminating SF6 emissions by the end of 2010.

of

Has committed to reducing absolute perfluorocarbon
emissions by 10% belowthe 1995 baseline level by the end of 2010.
        ' Voluntary Innovative Sector Initiatives: Opportunities Now
        FIGURE 33. Partner actions are projected to maintain emissions of fluorinated gases below 1990 levels through 2012

                                                                               WITHOUT PARTNER ACTIONS
                                                                               WITH PARTNER ACTIONS

              1990
1995
2000
2005
2010
2012
        TABLE 26. Goals and achievements of EPA's Fluorinated Gas Programs
PROGRAM
VOLUNTARY ALUMINUM INDUSTRIAL
PARTNERSHIP (VAIP)
Industry Participation (% in program)
Reductions (MMTCE)
HFC-23
Industry Participation (% in program)
Reductions (MMTCE)
OTHER STEWARDSHIP PROGRAMS
Industry Participation (% in program)*
Reductions (MMTCE)
TOTAL REDUCTIONS (MMTCE)
2007 GOAL


99%
2.7

100%
4.9

50-100%
4.7
12.3
2007 ACHIEVEMENT


99%
2.5

100%
7.0

50-100%
4.3
13.8
2008 GOAL


99%
2.7

100%
4.7

50-100%
5.9
13.3
        * Participation varies from 45% of net generating capacity for electric power systems to 100% for primary magnesium producers.
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                                                    53

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           Sulfur Hexafluoride (SF6) Emissions
           Reduction Partnership for Electric
           Power Systems
                             SF6 is the most potent and persistent
                             greenhouse gas. Used primarily by
                             electric utilities, SF6 is a gaseous
                             dielectric for high-voltage circuit
           breakers and gas-insulated substations. The global warming
           potential of SF6 is 23,900 over a 100-year time period,
           which means it is 23,900 times more effective at trapping
           infrared radiation than an equivalent amount of C02.

           Since 1999, EPA has partnered with several electric
           utilities in a voluntary program to reduce SF6 emissions. In
           addition to providing a means to actively address climate
           change, this program has helped partner companies reap
           financial savings through reduced  SF6 gas purchases.
           Members of the partnership represent 46 percent of the
           total U.S. transmission system.

           In 2007, the SF6  Emissions Reduction
           Partnership for Electric Power Systems:
           • Reduced emissions by 1.7 MMTCE, bringing average
            SF6 emissions rates down to 5.4 percent of the total
            equipment nameplate capacity.
           • Recruited four new companies into the  Partnership:
            City of Palo Alto Utilities, Oglethorpe Power, PNM
            Resources, and \JCTransmission.
           • Partnered with service providers to complete two
            training Webcasts on gas inventory management and
            monitoring leaks.
           • Continued to work with partners to update SF6
            reduction goals through the year 2012.
           • Recognized two partners—MidAmerican Energy and
            Southern Company—for their significant emissions
            reductions and their exemplary  participation in the
            Partnership.


           SF6 Emission Reduction Partnership for
           the Magnesium Industry
                          The U.S. magnesium industry and the
                          International Magnesium Association
                          (IMA) are working with  EPA to identify
                          and adopt best management practices
Sft Emission Reduction
Partnership for the Magnesium Industry
for reducing and eliminating emissions of SF6. Launched in
1999, this partnership works to reduce SF6 emissions from
magnesium production and casting operations, and
currently includes more than 80 percent of the U.S.
magnesium industry. Partner companies are supporting
the President's Climate VISION initiative and striving to
completely eliminate their firms' SF6 emissions by the  end
of 2010.

In 2007, the SF6 Emission Reduction  Partnership
for the Magnesium Industry:
• Reduced SF6 emissions equivalent to 0.18 MMTCE.
  2007 was the eighth year in which EPA collected
  annual SF6 emissions reports from magnesium
  industry partners.
• Organized and led the 3rd International Melt Protection
  Users Group Round  Table in conjunction with the 2007
  Annual World Magnesium Conference in Vancouver,
  British Columbia.  More than 25 industry and
  government participants from Asia, Europe, North
  America, and the  Middle East exchanged technical
  information on phasing out SF6-based melt protection.
• Completed the fourth study of alternative  melt
  protection technologies and associated air emissions.
  Partner company MagReTech  hosted the study. EPA's
  evaluation of cover  gas alternatives included
  quantification of cover gas destruction values to better
  determine actual  emissions rates.
• Maintained U.S. industry participation in the
  partnership, representing 100 percent of primary
  magnesium production and 80 percent of domestic
  casting and recycling  capacity.
• Announced that two partner companies—Meridian
  and MagReTech—have initiated SF6 phase-out
  projects to transition to alternative cover gases.


Mobile Air Conditioning  Climate Protection
Partnership
Motor vehicle air conditioners contribute significantly to
global greenhouse gas emissions through vehicle
gasoline consumption  and direct refrigerant emissions.
In the United States alone, vehicle air conditioners use
7 billion gallons of gasoline every year, equivalent to over
16 MMTCE.15 Additionally, refrigerant emissions
contribute more than 8 MMTCE annually.16
54
             For more information, see Andersen, S., et al., 2004.
           IK
             HFC-134a emissions: the refrigerant most commonly used in mobile AC systems since 1994. This does not include emissions of CFC-12 from
             pre-1994 automobile models still in the U.S. fleet.

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                                                                                               FLUORINATED GAS PROGRAMS
        The global partnership formed in 1998 among the Society of
        Automotive Engineers (SAE), the Mobile Air Conditioning Society
        Worldwide, and EPA to reduce the climate impacts of mobile air
        conditioning (MAC) systems now includes most of the world's
        vehicle manufacturers and their suppliers, environmental and
        industry NGOs, and representatives from industrialized and
        developing country governments. The MAC Partnership
        has four goals:

        • Promote cost-effective designs and improved service
          procedures to minimize refrigerant emissions.
        • Promote next-generation MAC systems that are better for
          the environment while satisfying customer safety, cost, and
          reliability concerns.
        • Communicate technical progress to policymakers and the public.
        • Document current and near-term opportunities to improve the
          environmental performance of MAC system design, operation,
          and maintenance.

        The partnership is now working to meet ambitious, quantitative
        goals announced in 2004 to reduce air conditioning fuel
        consumption by at least 30 percent and cut refrigerant
        emissions by 50 percent.
        FIGURE 34. Over the lifetime of a vehicle, an IMAC*
        system will save more than $900 and prevent almost
        5,000 Ibs of greenhouse gas emissions
                                                      ,-6000
                                                      -5000
                                                      _4000 2
                                                            CM


                                                      - 3000 ES
                                                      |- 2000 >
                                   DOLLARS SAVED
                                   GREENHOUSE GAS
                                   EMISSIONS AVOIDED




U 1000
                12  34  56  7  8 9 10 11 12 13 14 15  16
                LIFETIME OF VEHICLE (YEARS)
        * Improved Mobile Air Conditioning (IMACI systems leak 50% less and are 30% more
         efficient than standard systems. Due to their leak-tight design, IMAC systems do not
         require the refrigerant recharging that regular mobile AC systems do.
In 2007, the Mobile Air Conditioning Climate
Protection Partnership:
• Published the Global Refrigerants Energy & Environmental
  Mobile Air Conditioning Lifecycle Climate Change
  Performance—GREEN-MAC-LCCP®17 The tool allows
  environmental and industry experts to compare alternative
  MAC refrigerants for the  best climate performance.
• Issued a government-industry consensus report on how
  HFC-152a can be safely and efficiently used in MACs with
  secondary-loop technology and published guidelines for
  efficient secondary-loop  HFC-152a MAC design.
• Formed an industry and government expert team to develop
  safety recommendations for R744, the industry term for C02-
  based vehicle air conditioners.

What to Expect in 2008 and Beyond for the
Fluorinated Gas  Programs
The fluorinated gas partnership programs for the industrial
sector will continue to work with their partners and implement
strategies to keep emissions below 1990 levels. EPA plans to:

• Continue to implement agreements with industry to reduce
  greenhouse gas intensity for the aluminum, magnesium, and
  semiconductor sectors through the Climate VISION effort.
• Continue recruiting companies to participate in the SF6
  Emissions  Reduction Partnership for Electric Power Systems
  and training partners to ensure the collection and reporting
  of high quality data by electric  power partners.
• Evaluate the technical feasibility and cost of continuous
  emissions  monitoring (CEM) of F-gases from the electronics
  industry.
• Support efforts of magnesium partners to eliminate emissions
  of SF6 by demonstrating alternative melt protection technologies
  for primary producers and secondary ingot casters.
• Announce plans in 2008 to introduce new AC technology
  using refrigerants with low global warming potentials.
• Translate the Web-based training module, Anode Effect
  Management, into other languages to facilitate global PFC
  emissions  reduction efforts.
• Launch a PFC Management Demonstration Project in China
  to support efforts to reduce PFC emissions by the Asia
  Pacific Partnership for Clean Development and Climate.
  China is the largest global producer  of primary aluminum.
• Maintain active partnerships with HCFC-22 chemical
  manufacturers to continue to reduce emissions of HFC-23.
        " To view the tool, please visit http://epa.gov/cppd/mac/compare.htm.

ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                                      55

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     DEMONSTRATING  PROGRESS:  MEASURING  RESULTS  OF THE
          \  CLIMATE  PROTECTION  PARTNERSHIP  PROGRAMS
          EPA's climate protection programs are an important
          component of the U.S. government's strategy to address
          climate change; they are expected to contribute about
          70 percent of the emissions reductions necessary to
          reach the President's greenhouse gas intensity
          improvement goal in 2012. As such, EPA is committed to
          documenting quantifiable program results and using
          well-established methods to estimate the benefits of its
          programs. For each program, EPA has a robust process
          in place to regularly review and improve the program
          evaluation approaches.

          The approaches used for each specific program are
          summarized in the sections below. They vary by program
          strategy, sector, availability of data, and market
          characteristics. In order to present the most realistic
          estimates of program benefits, EPA employs a common
          analytical framework across all of the individual program
          approaches:

          • The benefits discussed represent the results
            attributable to EPA efforts above pre-existing trends
            or BAU scenarios.
          • Program methods address data quality, potential
            double counting with other  EPA programs, free
            ridership, the efforts of third-party actors, and other
            program-specific market effects.
          • Where marginal  uncertainty exists, EPA uses the best
            available  information and best practices thatyield
            conservative benefit estimates.
          • Cumulative estimated benefits reflect the stream of
            energy savings that will persist through 2017 due to
            investments made through 2007. For this analysis, EPA
            assumes  no new investments will be made through its
            programs in 2008 or beyond.
          • Financial  benefits are placed in present value terms.

          Environmental and financial benefits for 2000 to 2007
          are summarized in Table 1 on p. 3. The historical
          environmental benefits and cost effectiveness of these
          programs are summarized on the next page (see Table 27
          and Figure 35). The information presented in this report is
          similar to much of the information used in the U.S. Office
          of Management and Budget (OMB) Program Assessment
          Rating Tool  (PART), which found these EPA programs to
          be achieving their goals.
ENERGY STAR
Through the ENERGY STAR program, EPA helps U.S.
businesses and consumers save money and reduce
greenhouse gas emissions by labeling energy-efficient
products, raising the bar of energy efficiency in new home
construction, and encouraging superior energy
management practices in the commercial and industrial
sectors. The methods for estimating the benefits of each
of these strategies are described below.

Products
• Sales of products due to the ENERGY STAR program
 are determined as those above and beyond
 established BAU purchases of these products.18
 These sales are estimated by:
 • Collecting annual sales data on ENERGY STAR
    qualifying products from participating product
    manufacturers as a condition of partnership and
    supplementing these data by industry reports on
    total annual product sales as necessary. These data
    are screened and issues resolved.
 • Using established BAU baselines for annual product
    sales for each product category. These baselines
    use historic data and  expert judgment, and they
    typically reflect increasing market shares for
    efficient products and increasing product
    efficiencies overtime.
 • Applying a conservative estimate of the effect
    of market transformation to  account for EPA efforts
    when product specifications are revised and
    qualified product shipments fall as manufacturers
    transition to the new specification.
• Annual energy savings are calculated using
 established values for the difference in annual energy
 use between a single ENERGY STAR product and a
 typically purchased product. For these values, EPA:
 • Assumes that ENERGY STAR products just meet the
    ENERGY STAR thresholds, even though there are
    some products that exceed  this level.
 • Assumes the typically purchased product meets
    minimum efficiency standards where standards exist
    or uses the average energy use for the product
    category where there are no standards.
56
            For more details on many aspects of this method, see Sanchez 2008 and Weber 2000.

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                                                                                                            DEMONSTRATING PROGRESS
         TABLE 27. Overview of EPA's Climate Partnership Programs reviewed in this annual report with greenhouse gas
         reductions since 2000
PROGRAM
Climate Leaders
ENERGY STAR
Clean Energy-
Environment State
Partnership
GHGs
ADDRESSED
All
C02
C02
KEY
SECTOR(S)
Commercial,
Industrial
Residential,
Commercial, Industrial
State
Government
SCOPE OF
PARTNERS
AS OF 2007
155
12,000
15
GHG REDUCTIONS*
2000 2001 2002 2003 2004 2005 2006 2007
Climate Leaders' reductions are reflected
in the data shown for other programs.
15.2 17.7 21.3 25.0 28.5 32.2 36.1 42.4
N/A N/A N/A
CLEAN ENERGY SUPPLY
Green Power
Combined Heat
and Power
C02
C02
State & Local
Government,
Commercial, Industrial
Commercial,
Industrial
850
200
N/A N/A 0.6 1.0 2.0 3.2 3.7 4.8
METHANE PROGRAMS
Natural Gas STAR
Coalbed Methane
Outreach Program
(CMOP)
Landfill Methane
Outreach Program
(LMOP)
CH4
CH4
CH4
Natural Gas
Coal Mining
Waste
Management
62% of industry
N/A
700
4.1 4.8 5.7 6.0 7.9 10.1 9.4 10.2
2.1 2.3 1.7 1.7 1.9 2.4 2.5 2.0
3.2 3.7 3.9 4.1 4.4 4.5 4.8 5.2
FLUORINATED GAS PROGRAMS
Voluntary Aluminum
Industrial Partnership
HFC-23 Partnership
Stewardship
Programs
Mobile Air
Conditioning (MAC)
Partnership
PFCs
HFCs
SF6
PFCs
C02
HFCs
Aluminum
Smelting
Chemical Industry
Magnesium
Production,
Semiconductor
Manufacturing,
Electric Power
Systems
MAC Industry
99% of industry
100% of industry
50%-100%
of industry
N/A
2.0 2.1 1.8 2.2 2.2 2.3 2.4 2.5
4.7 5.1 4.5 6.1 6.4 6.2 7.0 7.0
0.8 0.8 1.3 1.8 3.1 3.0 3.8 4.3
Working toward technology
improvement goals
         "These reductions reflect the most up-to-date data collected from EPA partners and may differ from reductions reported in previous annual reports.
         N/A: Not applicable

         FIGURE 35. EPA programs are highly cost-effective mechanisms for reducing greenhouse gas emissions
          EPA's climate protection programs are a very cost-effective approach for
          reducing U.S. greenhouse gas emissions. Moreover, it is clear from
          sources such as the IPCC's Fourth Assessment Report and McKinsey's
          recent study that there are still great untapped opportunities for these
          programs to capture—meaning they will continue to be cost-effective far
          into the future (see Figure 5, p. 9). Every federal dollar spent on these
          partnership programs through 2007 means:
* Reductions in greenhouse gas emissions of 1.0 metric ton
  of carbon equivalent.
* Savings for partners and consumers of more than $75 on their
  energy bills.
* Private sector investment of more than $15.
* A net savings of more than  $60.
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                           57

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              Supports primary data collection, such as product
              metering to collect power use information, where
              additional information is necessary to estimate
              energy savings.
              Uses product-specific lifetimes that vary from
              4 to 20 years. While those who purchase an ENERGY
              STAR qualified product  are likely to replace it with
              one, EPA includes only  a fraction  of replacement
              purchases and investments in the program benefits.
           • Peak power savings are estimated using product-
             specific factors that reflect the contribution of the
             annual energy savings from a product to peak load
             savings.
           • Net energy bill savings  is  the present value (PV) of
             energy bill savings minus  the PV of any incremental
             cost of purchasing an ENERGY STAR product above a
             standard model over the product lifetimes discussed
             above.19 All  energy bill calculations use national
             sector-specific fuel prices.
           • Avoided emissions of greenhouse gases for 2007 are
             determined using  marginal emissions factors for C02
             based  on factors established as part of the U.S.
             government's reporting  process to the UN Framework
             Convention on Climate Change, as well as historical
             emissions data from EPA's eGRID database.20 For
             future years, EPA  uses factors derived from energy
             efficiency scenario runs of the integrated utility
             dispatch model, Integrated Planning Model (IPM®).21

           New Homes
           • EPA receives data quarterly from third-party verifiers
             (home  energy raters) on the number of homes they
             verified to be ENERGY STAR, as a condition of program
             partnership. These raters  abide by a set of quality
             assurance practices to  ensure data quality. In addition,
             EPA reviews the submitted data and resolves any data
             irregularities.
           • EPA recognizes that some new homes that qualify for
             ENERGY STAR are not a direct result of the program
             and that many homes built to ENERGY STAR levels due
             to the program are not labeled or reported to the
             program. Currently, EPA estimates the former number
             of homes to be lower than the latter.
• Annual energy savings are calculated using
  established values for the energy savings from a home
  that meets the ENERGY STAR specification  relative to a
  home built to code. Energy bill savings are calculated
  using a similar approach as for products and average
  national energy prices for the residential sector. The
  average lifetime of a  home for both energy  and bill
  savings is 30 years.
• Peak power savings and avoided emissions of
  greenhouse gases are determined using approaches
  similar to those described for products.

Commercial Buildings
• Annual electricity and natural gas savings are
  determined based  on a peer-reviewed  methodology
  developed  for the commercial building sector.22 The
  methodology involves a counterfactual econometric
  analysis that forecasts state level electricity use in the
  absence of commercial building energy efficiency
  programs.  Key determinants of electricity demand
  that are controlled for in the analysis include state
  energy prices, weather conditions, economic
  conditions, other federal programs—such as DOE's
  Rebuild and Federal Energy Management Program
  (FEMP)—and the long-term U.S. trend in commercial
  sector electronic technologies. Once the net national
  change in electricity  use due to publicly funded energy
  efficiency programs is calculated, ENERGY STAR
  accomplishments are differentiated from other national
  and regional demand-side management(DSM) and
  market transformation programs. The methodology used
  for 2007 is  an update  of two former peer-reviewed
  methodologies used by EPA; nevertheless, the results
  of all three methodologies yield consistent estimates of
  ENERGY STAR accomplishments.23
• The peak power savings are estimated using system-
  specific factors that reflect the contribution of the
  energy savings from lighting and other building
  improvements to peak load  savings.
           '" Calculated using a 7% discount rate and 2007 perspective.
           20 For more details on eGRID, see U.S. EPA, 2007.
           21 For more details on IPM, see U.S. EPA, 2006.

             For more details on many aspects of this method, see Horowitz, M.J., 2007 and 2008.
58
             For more details on many aspects of this method, see Horowitz, M.J., 2007.

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           • As with products, net energy bill savings reflect the
            incremental investment necessary to upgrade the
            building to ENERGY STAR specifications determined  by
            using simple payback period decision criteria. EPA
            assumes most building and industrial facility
            improvements last at least 10 years and uses national
            commercial sector fuel prices.
           • Avoided emissions of greenhouse gases are
            determined using marginal emissions factors for
            C02 as with products.

           Industry
           Annual  industrial electricity and natural gas savings are
           determined using a peer-reviewed methodology similar to
           that used for the commercial sector.24 The methodology
           distinguishes savings due to ENERGY STAR from those
           due to utility-run DSM programs and other market
           transformation programs such as  DOE's Industrial
           Technology Program (ITP). Greenhouse gas emissions are
           calculated using marginal C02 emissions as with products.


           The Clean Energy Supply Programs

           Combined  Heat and Power (CHP) Partnership
           The CHP Partnership dismantles the market barriers
           stifling investment in environmentally beneficial CHP
           projects. Program partners such as project owners
           voluntarily provide project-specific information on newly
           operational CHP projects to EPA. These data are screened
           and any issues resolved.

           Energy savings are determined on a project-by-project
           basis, based  on fuel type, system capacity, and
           operational profile. Estimates of the use of fossil and
           renewable fuels are developed, as well as the efficiency
           of thermal and electrical use or generation, as appropriate.

           Emissions reductions are calculated on a project-by-
           project  basis to reflect the  greater efficiency of onsite
           CHP. Avoided emissions of greenhouse gases from more
           efficient energy generation are determined using marginal
           emissions factors derived from energy efficiency scenario
           runs of  IPM, and displaced emissions from boiler
           produced thermal energy are developed through
           engineering estimates.  In addition, emissions reductions
           may include avoided transmission and distribution losses,
           as appropriate.
                                 DEMONSTRATING PROGRESS
Only the emissions reductions from projects that meet the
assistance criteria for the program are included in the
program benefit estimates. EPA also addresses the
potential for double counting benefits between this and
other partnerships by having program staff meet annually
to identify and resolve any overlap issues.

Green Power Partnership
The Green Power Partnership boosts supply of clean
energy by helping U.S. businesses purchase electricity
from green generation sources. As a condition of
partnership, program partners submit data annually on
their purchases of qualifying green power products.
These data are screened and any issues resolved.

Avoided emissions of greenhouse gases are determined
using marginal emissions factors for C02 derived from
scenario runs of IPM.

The potential for double counting, such as counting
green power purchases that may be required  as part
of a renewable portfolio standard or may rely  on
resources that are already part of the system  mix,  is
addressed through a partnership requirement that green
power purchases be incremental to what may already
be required.

EPA estimates that the vast majority of the green power
purchases made by program partners are due to the
partnership, as partners comply with aggressive green
power procurement requirements (usually at incremental
cost) to remain in the program. Further, EPA estimates
that its efforts to foster a growing voluntary green  power
market have likely led to additional voluntary green
power purchases that have not been reported through
the program.
             For more details on many aspects of the previous methods, see Horowitz, M.J., 2004 and 2001.

ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report
                                                          59

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           The Methane Programs
           EPA's methane programs facilitate recovering methane
           from landfills, natural gas extraction systems, agriculture,
           and coal mines as well as using methane as a clean
           energy resource. The expenditures used in the program
           analyses include the capital costs agreed to by partners
           to bring projects into compliance with program
           specifications and any additional operating costs
           engendered by program participation.

           Natural Gas STAR
           As a condition of partnership, program partners submit
           implementation plans to EPA describing the emissions
           reduction practices they plan to implement and evaluate.
           In addition, partners submit progress reports detailing
           specific emissions reduction activities and
           accomplishments each year.

           EPA does not attribute all reported emissions reductions
           to Natural Gas STAR. Partners may only include actions
           that were undertaken voluntarily, not those reductions
           attributable to compliance with existing regulations.

           Emissions reductions are estimated  by the  partners either
           from direct before-and-after measurements or by applying
           peer-reviewed emissions reduction factors.

           Landfill Methane Outreach
           EPA maintains a comprehensive database of the
           operational data on  landfills and landfill gas energy
           projects in the United States. The data are updated
           frequently based on information submitted  by industry,
           LMOP outreach efforts, and other sources.

           Reductions of methane that result from compliance with
           EPA's air regulations are not included in the program
           estimates. In addition, only the emissions reductions from
           projects that meet the LMOP assistance  criteria are
           included in the program benefit estimates.

           EPA uses emissions factors that are appropriate to the
           project. The factors are based on research, discussions
           with experts in the landfill gas  industry, and published
           references.
Coalbed Methane Outreach
Through cooperation with the U.S. Mine Safety & Health
Administration, state oil and gas commissions, and
the mining companies themselves, EPA collects mine-
specific data annually and estimates the total methane
emitted from the mines and the quantity of gas recovered
and used.

There are no regulatory requirements for recovering and
using coal mine methane; such efforts are entirely
voluntary. EPA estimates  coal mine methane recovery
attributable to its  program activities on a mine-specific
basis, based on the program's interaction with each mine.


The Fluorinated  Gas Programs
Due to the small pool of potential partners for the F-gas
programs, financial expenditures and savings are
proprietary information of program partners and not
included in the summary  of economic benefits.

Voluntary Aluminum  Industry Partnership
VAIP partners agree to report aluminum production and
anode effect frequency and duration in order to estimate
annual PFC emissions.

Reductions  are calculated by comparing current emissions
to  a BAU  baseline that uses the industry's  1990 emissions
rate. Changes in the emissions rate (per ton production)
are used to estimate the annual greenhouse gas
emissions and reductions resulting from the program.

The aluminum industry began making significant efforts to
reduce PFC emissions as a direct result of EPA's climate
partnership program. Therefore, all reductions achieved
by partners are assumed to be the result of the program.
60

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                                                                                                   DEMONSTRATING PROGRESS
           HFC-23 Emission Reduction Program
           Program partners report HCFC-22 production and
           HFC-23 emissions to a third party that aggregates the
           estimates and submits the total estimates for the previous
           year to EPA.

           Reductions are  calculated by comparing current
           emissions to a BAU baseline that uses the industry's
           1990 emissions  rate. Changes in the emissions rate are
           used to estimate the annual greenhouse gas emissions
           and reductions  resulting from the program.

           Subsequent to a series  of meetings with EPA, industry
           began making significant efforts to reduce HFC-23
           emissions. All U.S. producers participate in the program;
           therefore, all  reductions achieved by manufacturers are
           assumed to be the result of the program.

           Environmental Stewardship Programs
           EPA's Environmental Stewardship Programs include the
           PFC and SF6 Electric and Magnesium Reduction
           Partnerships. Partners report emissions and emissions
           reductions based on jointly developed estimation methods
           and reporting protocols. Data collection methods are
           sector specific, and data are submitted to EPA either
           directly or through a designated third party.

           Reductions are  calculated by comparing current
           emissions to a BAU baseline, using industry-wide or
           company-specific emissions rates in a base year. The
           reductions in emissions rates are used to calculate the
           overall greenhouse gas emissions reductions from the
           program.

           The share of the reductions attributable to EPA's programs
           is identified based on a  detailed review of program
           activities and industry-specific information.
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report                                                             61

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     FIGURES
          FIGURE 1.  Greenhouse gas emissions reductions exceed 75 MMTCE—Equivalent to emissions
                    from 52 million vehicles	3
          FIGURE 2.  ENERGY STAR benefits continue to grow	3
          FIGURE 3.  Potential for additional greenhouse gas reductions from EPA Climate Partnership Programs	7
          FIGURE 4.  International Climate Protection Awards	7
          FIGURE 5.  Two new reports highlight the critical role of energy efficiency and clean energy as low-cost
                    opportunities for greenhouse gas emissions reductions	9
          FIGURE 6.  U.S. C02 emissions by sector and non-C02 gases by percent of total GHGs	11
          FIGURE 7.  U.S. electricity generation by fuel type	11
          FIGURE 8.  The 155 Climate Leaders by sector	13
          FIGURE 9.  Keeping ENERGY STAR strong for the future	15
          FIGURE 10. ENERGY STAR Awards	17
          FIGURE 11. More than 2.5 billion ENERGY STAR qualified products purchased since 1992	19
          FIGURE 12. Awareness of ENERGY STAR growing in the United States	19
          FIGURE 13. National bus tour helps ENERGY STAR campaign reach millions	21
          FIGURE 14. Home Performance with ENERGY STAR spreads across the country	21
          FIGURE 15. ENERGY STAR qualified new homes gaining market share	23
          FIGURE 16. 840,000 homes nationwide bear the ENERGY STAR	23
          FIGURE 17. More than 4,000 buildings have earned the ENERGY STAR	25
          FIGURE 18. ENERGY STAR Challenge participants	25
          FIGURE 19. Commercial building rating and labeling activity gains momentum	27
          FIGURE 20. 10 percent of commercial square footage is rated	27
          FIGURE 21. Amount of rated floor space by state	27
          FIGURE 22. EPA reports that improving energy efficiency in U.S. data centers could save $4 billion annually	29
          FIGURE 23. Energy Strategy for the Road Ahead	33
          FIGURE 24. Climate Choice targets early adopters and environmentally motivated consumers	35
          FIGURE 25. Green Power purchases and avoided greenhouse gas (GHG) emissions almost doubled  in 2007	37
          FIGURE 26. Combined heat and power capacity by state as of 2007	39
          FIGURE 27. Tools and resources for states	41
          FIGURE 28. Partner actions are projected to maintain methane emissions below 1990 levels through 2012	45
          FIGURE 29. Natural Gas STAR cumulative greenhouse gas emissions reductions and gas savings	47
          FIGURE 30. Direct use and electric capacity of LMOP-assisted projects	49
          FIGURE 31. Landfill gas energy projects across the country	49
          FIGURE 32. Exporting the success of EPA's domestic Methane Programs: Methane to Markets (M2M)	51
          FIGURE 33. Partner actions are projected to maintain emissions of fluorinated gases below 1990 levels through 2012 . .53
          FIGURE 34. Over the lifetime of a vehicle, an IMAC system will save more than $900 and prevent
                    almost 5,000 Ibs of greenhouse gas emissions	55
          FIGURE 35. EPA programs are highly cost-effective mechanisms for reducing greenhouse gas emissions	57
62

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        TABLES
        TABLE 1.  Annual and cumulative benefits from partner actions through 2007
                 (in billions of 2007 dollars and MMTCE) 	3
        TABLE 2.  ENERGY STAR key program indicators, 2000 and 2007	5
        TABLE 3.  Long-term greenhouse gas reduction goals for EPA Climate Partnership Programs (MMTCE) 	7
        TABLE 4.  Market barriers addressed by EPA's Climate Partnership Programs	11
        TABLE 5.  Climate Leaders key program indicators for 2004 - 2007 (cumulative) 	13
        TABLE 6.  Seven Climate Leaders achieve their climate protection goals in 2007	13
        TABLE 7.  Key resources of Climate Leaders Program	13
        TABLE 8.  ENERGY STAR program achievements exceed goals in 2007	15
        TABLE 9.  Average energy savings of ENERGY STAR qualified products	16
        TABLE 10. ENERGY STAR residential product specifications added, revised, and in progress	19
        TABLE 11. ENERGY STAR commercial product specifications  added, revised, and in progress	29
        TABLE 12. Summary of EPA's ENERGY STAR Industrial Focuses 	31
        TABLE 13. EPA expands ENERGY STAR for superior energy management of industrial plants	31
        TABLE 14. Findings of the Climate Technology Initiative Conference	35
        TABLE 15. Greenhouse gas emissions avoided by EPA's Clean Energy Supply Programs (MMTCE)	37
        TABLE 16. EPA recognizes 17 leading Green Power partners in 2007	37
        TABLE 17. 2007 ENERGY STAR Combined Heat and Power Awards	39
        TABLE 18. Clean Energy-Environment State Partnership grows to 15 partners in 2007	41
        TABLE 19. 120 organizations have made commitments under the National Action Plan for Energy Efficiency	43
        TABLE 20. Resources available in support of the Action Plan's Vision for 2025 goals	43
        TABLE 21. Global warming potentials (GWPs) and atmospheric lifetimes of greenhouse gases	45
        TABLE 22. EPA's Methane Programs meet and surpass goals	45
        TABLE 23. 2007 Natural Gas STAR Awards	47
        TABLE 24. 2007 Landfill Methane Outreach Program Awards	51
        TABLE 25. Climate VISION* goals for EPA's Fluorinated Gas Programs	53
        TABLE 26. Goals and achievements of EPA's Fluorinated Gas Programs	53
        TABLE 27. Overview of EPA's Climate Partnership Programs reviewed in this annual report with
                 greenhouse gas reductions since 2000	57
ENERGY STAR® and Other Climate Protection Partnerships 2007 Annual Report                                                           63

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            www.epa.gov/cleanenergy/energy-resources/egrid/index.html.

            U.S. EPA. 2006. "Documentation for EPA Base Case 2006 (V.3.0) Using the Integrated Planning Model." November. Available online at
            www.epa.gov/airmarkets/progsregs/epa-ipm/index.html/docs

            Webber, C.A., R.E. Brown, M. McWhinney,  and J.G. Koomey. 2000. "Savings estimates for the  ENERGY STAR voluntary labeling program."
            Energy Policy 28 (2000) 1137-1149.
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    United States
    Environmental Protection Agency
    Air and Radiation 6202J
    EPA430-R-08-015
    www.epa.gov
    October 2008

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