For Immediate Release - October 02, 2009

Commonwealth Petitions US Department of Energy to Permit Massachusetts to Boost Residential Gas Furnace Efficiency

Proposed 90 percent efficiency standard would result in $144 million in fuel savings statewide by 2030

BOSTON - Attorney General Martha Coakley and Department of Energy Resources Commissioner (DOER) Commissioner Phil Giudice today petitioned the US Department of Energy (DOE) to allow Massachusetts to enforce a gas furnace efficiency standard significantly stricter than the federal standard - a move that could save Massachusetts consumers approximately $144 million in heating costs between 2013 and 2030, while cutting greenhouse gas emissions over the same period by approximately 100,000 metric tons.

The proposed 90 percent efficiency standard would save the average household buying a natural gas furnace at least $3,600 in natural gas costs over a 20-year furnace life - or $180 in annual fuel costs - compared to purchasing a furnace that meets DOE's current minimum efficiency requirement. Between 2013 and 2030, the stricter standard is estimated to result in statewide cumulative natural gas use savings of 19.4 million therms - the amount of natural gas consumed annually by 19,400 households.

"Massachusetts has proven itself to be a leader on forward-thinking energy efficiency policies and this is another example of how we are continuing to look for ways to mitigate costs on consumers through reduced consumption initiatives and policies," said Attorney General Coakley. "We also realize how critical it is to combat climate change, and saving significant amounts of energy will also limit the emissions of harmful greenhouse gases. It is critical that we continue to pursue new ways to save on our long-term energy costs and we are hopeful the DOE grants this waiver request so we can continue that mission."

"Energy prices here are well above the national average, and space heating is a bigger part of our overall energy bills, so the efficiency of our furnaces really matters," Commissioner Giudice said. "We urge the DOE to grant this waiver, which will enable Massachusetts to start requiring the use of highly efficient gas furnaces that will save consumers money, cut fuel use and support the Commonwealth's nation-leading greenhouse gas emissions goals."

In November 2007, the DOE increased the national "annual fuel utilization efficiency" (AFUE) standard for residential gas furnaces from 78 percent to 80 percent. The Commonwealth and others filed a legal challenge to the federal rule, contending that 80 percent is far too lenient given that 90 percent efficient furnace models are widely available. With that litigation pending when it took office in January, the Obama Administration placed a hold on moving to an 80 percent AFUE, and the DOE is currently reconsidering its efficiency standard for residential natural gas furnaces sold nationwide.

Meanwhile, Massachusetts has been preparing today's waiver application to enable the Commonwealth to enforce previously adopted state regulations calling for a 90 percent AFUE standard. Under federal law, the Commonwealth can't implement the stricter rule without a waiver from the DOE. If the waiver is granted, it would mark the first time the DOE has allowed a state to set appliance efficiency standards more stringent than existing federal ones.

In making today's announcement, Commissioner Giudice and Attorney General Coakley noted that the waiver filing resulted from a collaborative effort between their departments and the National Consumer Law Center (NCLC). State officials acknowledged, in particular, the efforts of NCLC attorney Charlie Harak, as well staff of the non-profit National Energy Efficiency Partnerships.

"Higher standards mean higher savings. With more efficient furnaces widely available, there is no reason why Massachusetts shouldn't be allowed to push full speed ahead to increase efficiency," said US Senator John Kerry. "This is an important step in helping us reduce costs to consumers, lower our dependence on foreign oil and cut down on carbon pollution."

"As Old Man Winter comes knocking on our door, Massachusetts residents should be able to lock up the most efficient and cost-saving furnaces possible. I applaud Massachusetts for its work to surpass federal standards for efficient furnaces," said Congressman Edward J. Markey.

"I have supported efforts to lower energy costs for Massachusetts consumers for many years. Whether it's fighting for federal LIHEP funds, or voting for energy efficiency and conservation programs in the Recovery Act, no family should have to choose between paying a heating bill or going cold in the winter. The petition to the DOE on gas furnace standards represents a clean and green way of lowering energy bills for local households. I strongly welcome the effort," said Congressman Richard E. Neal.

"If approved by the Department of Energy, this waiver would not only save Massachusetts energy consumers an estimated $144 million by 2030, it would reduce overall energy use and greenhouse gas emissions," said Congressman John F. Tierney. "For these reasons, I applaud the Commonwealth's application and urge its favorable consideration by the Department of Energy."

If approved, the new efficiency standard would apply to new furnace purchases starting in 2013 (or three years after DOE approval). There would be no requirement to replace existing furnaces still in use. From a practical standpoint, the proposed change would be easily achieved in Massachusetts, since all major furnace manufacturers that supply equipment to the state offer models that meet or exceed the 90 percent efficiency standard. In addition, local gas companies regularly use furnaces that are at least 90 percent efficient when they replace old ones, and 90 percent efficient models are required for use by the Massachusetts Department of Housing and Community Development's low-income weatherization program.

Requiring higher efficiency for natural gas furnaces is especially relevant in Massachusetts, where "heating degree days" (the number of degrees that a day's average temperature is below 65 F and buildings need to be heated) exceed the national average by approximately 50 percent. By reducing use of this fossil fuel statewide, the more stringent standard would also support the Commonwealth's nation-leading greenhouse gas emissions reduction goals. The Global Warming Solutions Act of 2008 requires Massachusetts to cut greenhouse gas emissions across the economy by up to 25 percent by 2020 and 80 percent by 2050.

The US DOE has up to one year to act on the Commonwealth's waiver petition.

Handling this case for Attorney General Coakley is Assistant Attorney General Fred Augenstern of Coakley's Environmental Protection Division.