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Electronic Code of Federal Regulations

e-CFR Data is current as of October 29, 2014

Title 10Chapter IISubchapter D → Part 436


Title 10: Energy


PART 436—FEDERAL ENERGY MANAGEMENT AND PLANNING PROGRAMS


Contents
§436.1   Scope.
§436.2   General objectives.

Subpart A—Methodology and Procedures for Life Cycle Cost Analyses

§436.10   Purpose.
§436.11   Definitions.
§436.12   Life cycle cost methodology.
§436.13   Presuming cost-effectiveness results.
§436.14   Methodological assumptions.
§436.15   Formatting cost data.
§436.16   Establishing non-fuel and non-water cost categories.
§436.17   Establishing energy or water cost data.
§436.18   Measuring cost-effectiveness.
§436.19   Life cycle costs.
§436.20   Net savings.
§436.21   Savings-to-investment ratio.
§436.22   Adjusted internal rate of return.
§436.23   Estimated simple payback time.
§436.24   Uncertainty analyses.

Subpart B—Methods and Procedures for Energy Savings Performance Contracting

§436.30   Purpose and scope.
§436.31   Definitions.
§436.32   Qualified contractors lists.
§436.33   Procedures and methods for contractor selection.
§436.34   Multiyear contracts.
§436.35   Standard terms and conditions.
§436.36   Conditions of payment.
§436.37   Annual energy audits.
§436.38   Terminating contracts.

Subpart C—Agency Procurement of Energy Efficient Products

§436.40   Purpose and scope.
§436.41   Definitions.
§436.42   Evaluation of Life-Cycle Cost Effectiveness.
§436.43   Procurement planning.

Subparts D-E [Reserved]

Subpart F—Guidelines for General Operations Plans

§436.100   Purpose and scope.
§436.101   Definitions.
§436.102   General operations plan format and content.
§436.103   Program goal setting.
§436.104   Energy conservation measures and standards.
§436.105   Emergency conservation plan.
§436.106   Reporting requirements.
§436.107   Review of plan.
§436.108   Waivers.
Appendix A to Part 436—Energy Conservation Standards for General Operations [Reserved]
Appendix B to Part 436—Goal Setting Methodology
Appendix C to Part 436—General Operations Energy Conservation Measures
Appendix D to Part 436—Energy Program Conservation Elements

Authority: 42 U.S.C. 7101 et seq.; 42 U.S.C. 8258; 42 U.S.C. 8259b.

Link to an amendment published at 79 FR 61571, Oct. 14, 2014.

Source: 44 FR 60669, Oct. 19, 1979, unless otherwise noted.

§436.1   Scope.

This part sets forth the rules for Federal energy management and planning programs to reduce Federal energy consumption and to promote life cycle cost effective investments in building energy systems, building water systems and energy and water conservation measures for Federal buildings.

[61 FR 32649, June 25, 1996]

§436.2   General objectives.

The objectives of Federal energy management and planning programs are:

(a) To apply energy conservation measures to, and improve the design for construction of Federal buildings such that the energy consumption per gross square foot of Federal buildings in use during the fiscal year 1995 is at least 10 percent less than the energy consumption per gross square foot in 1985;

(b) To promote the methodology and procedures for conducting life cycle cost analyses of proposed investments in building energy systems, building water systems and energy and water conservation measures;

(c) To promote the use of energy savings performance contracts by Federal agencies for implementation of privately financed investment in building and facility energy conservation measures for existing Federally owned buildings; and

(d) To promote efficient use of energy in all agency operations through general operations plans.

[55 FR 48220, Nov. 20, 1990, as amended at 60 FR 18334, Apr. 10, 1995; 61 FR 32649, June 25, 1996]

Subpart A—Methodology and Procedures for Life Cycle Cost Analyses

Source: 55 FR 48220, Nov. 20, 1990, unless otherwise noted.

§436.10   Purpose.

This subpart establishes a methodology and procedures for estimating and comparing the life cycle costs of Federal buildings, for determining the life cycle cost effectiveness of energy conservation measures and water conservation measures, and for rank ordering life cycle cost effective measures in order to design a new Federal building or to retrofit an existing Federal building. It also establishes the method by which efficiency shall be considered when entering into or renewing leases of Federal building space.

[61 FR 32649, June 25, 1996]

§436.11   Definitions.

As used in this subpart—

Base Year means the fiscal year in which a life cycle cost analysis is conducted.

Building energy system means an energy conservation measure or any portion of the structure of a building or any mechanical, electrical, or other functional system supporting the building, the nature or selection of which for a new building influences significantly the cost of energy consumed.

Building water system means a water conservation measure or any portion of the structure of a building or any mechanical, electrical, or other functional system supporting the building, the nature or selection of which for a new building influences significantly the cost of water consumed.

Component price means any variable sub-element of the total charge for a fuel or energy or water, including but not limited to such charges as “demand charges,” “off-peak charges” and “seasonal charges.”

Demand charge means that portion of the charge for electric service based upon the plant and equipment costs associated with supplying the electricity consumed.

DOE means Department of Energy.

Energy conservation measures means measures that are applied to an existing Federal building that improve energy efficiency and are life cycle cost effective and that involve energy conservation, cogeneration facilities, renewable energy sources, improvements in operation and maintenance efficiencies, or retrofit activities.

Federal agency means “agency” as defined by 5 U.S.C. 551(1).

Federal building means an energy or water conservation measure or any building, structure, or facility, or part thereof, including the associated energy and water consuming support systems, which is constructed, renovated, leased, or purchased in whole or in part for use by the Federal government. This term also means a collection of such buildings, structures, or facilities and the energy and water consuming support systems for such collection.

Investment costs means the initial costs of design, engineering, purchase, construction, and installation exclusive of sunk costs.

Life cycle cost means the total cost of owning, operating and maintaining a building over its useful life (including its fuel and water, energy, labor, and replacement components), determined on the basis of a systematic evaluation and comparison of alternative building systems, except that in the case of leased buildings, the life cycle cost shall be calculated over the effective remaining term of the lease.

Non-fuel operation and maintenance costs means material and labor cost for routine upkeep, repair and operation exclusive of energy cost.

Non-recurring costs means costs that are not uniformly incurred annually over the study period.

Non-water operation and maintenance costs mean material and labor cost for routine upkeep, repair and operation exclusive of water cost.

Recurring costs means future costs that are incurred uniformly and annually over the study period.

Replacement costs mean future cost to replace a building energy system or building water system, an energy or water conservation measure, or any component thereof.

Retrofit means installation of a building energy system or building water system alternative in an existing Federal building.

Salvage value means the value of any building energy system or building water system removed or replaced during the study period, or recovered through resale or remaining at the end of the study period.

Study period means the time period covered by a life cycle cost analysis.

Sunk costs means costs incurred prior to the time at which the life cycle cost analysis occurs.

Time-of-day rate means the charge for service during periods of the day based on the cost of supplying services during various times of the day.

Water conservation measures mean measures that are applied to an existing Federal building that improve the efficiency of water use, reduce the amount of water for sewage disposal and are life cycle cost effective and that involve water conservation, improvements in operation and maintenance efficiencies, or retrofit activities.

[55 FR 48220, Nov. 20, 1990, as amended at 61 FR 32649, June 25, 1996]

§436.12   Life cycle cost methodology.

The life cycle cost methodology for this part is a systematic analysis of relevant costs, excluding sunk costs, over a study period, relating initial costs to future costs by the technique of discounting future costs to present values.

§436.13   Presuming cost-effectiveness results.

(a) If the investment and other costs for an energy or water conservation measure considered for retrofit to an existing Federal building or a building energy system or building water system considered for incorporation into a new building design are insignificant, a Federal agency may presume that such a system is life cycle cost-effective without further analysis.

(b) A Federal agency may presume that an investment in an energy or water conservation measure retrofit to an existing Federal building is not life cycle cost-effective for Federal investment if the Federal building is—

(1) Occupied under a short-term lease with a remaining term of one year or less, and without a renewal option or with a renewal option which is not likely to be exercised;

(2) Occupied under a lease which includes the cost of utilities in the rent and does not provide a pass-through of energy or water savings to the government; or

(3) Scheduled to be demolished or retired from service within one year or less.

[55 FR 48220, Nov. 20, 1990, as amended at 61 FR 32650, June 25, 1996]

§436.14   Methodological assumptions.

Link to an amendment published at 79 FR 61571, Oct. 14, 2014.

(a) Each Federal Agency shall discount to present values the future cash flows established in either current or constant dollars consistent with the nominal or real discount rate, and related tables, published in the annual supplement to the Life Cycle Costing Manual for the Federal Energy Management Program (NIST 85-3273) and determined annually by DOE as follows—

(1) The nominal discount rate shall be a 12 month average of the composite yields of all outstanding U.S. Treasury bonds neither due nor callable in less than ten years, as most recently reported by the Federal Reserve Board; and

(2) Subject to a ceiling of 10 percent and a floor of three percent the real discount rate shall be a 12 month average of the composite yields of all outstanding U.S. Treasury bonds neither due nor callable in less than ten years, as most recently reported by the Federal Reserve Board, adjusted to exclude estimated increases in the general level of prices consistent with projections of inflation in the most recent Economic Report of the President's Council of Economic Advisors.

(b) Each Federal agency shall assume that energy prices will change at rates projected by DOE's Energy Information Administration and published by NIST annually no later than the beginning of the fiscal year in the Annual Supplement to the Life Cycle Costing Manual for the Federal Energy Management Program, in tables consistent with the discount rate determined by DOE under paragraph (a) of this section, except that—

(1) If the Federal agency is using component prices under §436.14(c), that agency may use corresponding component escalation rates provided by the energy or water supplier.

(2) For Federal buildings in foreign countries, the Federal agency may use a “reasonable” escalation rate.

(c) Each Federal agency shall assume that the price of energy or water in the base year is the actual price charged for energy or water delivered to the Federal building and may use actual component prices as provided by the energy or water supplier.

(d) Each Federal agency shall assume that the appropriate study period is as follows:

(1) For evaluating and ranking alternative retrofits for an existing Federal building, the study period is the expected life of the retrofit, or 25 years from the beginning of beneficial use, whichever is shorter.

(2) For determining the life cycle costs or net savings of mutually exclusive alternatives for a given building energy system or building water system (e.g., alternative designs for a particular system or size of a new or retrofit building energy system or building water system), a uniform study period for all alternatives shall be assumed which is equal to—

(i) The estimated life of the mutually exclusive alternative having the longest life, not to exceed 25 years from the beginning of beneficial use with appropriate replacement and salvage values for each of the other alternatives; or

(ii) The lowest common multiple of the expected lives of the alternative, not to exceed 25 from the beginning of beneficial use with appropriate replacement and salvage values for each alternative.

(3) For evaluating alternative designs for a new Federal building, the study period extends from the base year through the expected life of the building or 25 years from the beginning of beneficial use, whichever is shorter.

(e) Each Federal agency shall assume that the expected life of any building energy system or building water system is the period of service without major renewal or overhaul, as estimated by a qualified engineer or architect, as appropriate, or any other reliable source except that the period of service of a building energy or water system shall not be deemed to exceed the expected life of the owned building, or the effective remaining term of the leased building (taking into account renewal options likely to be exercised).

(f) Each Federal agency may assume that investment costs are a lump sum occurring at the beginning of the base year, or may discount future investment costs to present value using the appropriate present worth factors under paragraph (a) of this section.

(g) Each Federal agency may assume that energy or water costs and non-fuel or non-water operation and maintenance costs begin to accrue at the beginning of the base year or when actually projected to occur.

(h) Each Federal agency may assume that costs occur in a lump sum at any time within the year in which they are incurred.

(i) This section shall not apply to calculations of estimated simple payback time under §436.22 of this part.

[55 FR 48220, Nov. 20, 1990, as amended at 61 FR 32650, June 25, 1996]

§436.15   Formatting cost data.

In establishing cost data under §§436.16 and 436.17 and measuring cost effectiveness by the modes of analysis described by §436.19 through §436.22, a format for accomplishing the analysis which includes all required input data and assumptions shall be used. Subject to §436.18(b), Federal agencies are encouraged to use worksheets or computer software referenced in the Life Cycle Cost Manual for the Federal Energy Management Program.

§436.16   Establishing non-fuel and non-water cost categories.

(a) The relevant non-fuel cost categories are—

(1) Investment costs;

(2) Non-fuel operation and maintenance cost;

(3) Replacement cost; and

(4) Salvage value.

(b) The relevant non-water cost categories are—

(1) Investment costs;

(2) Non-water operation and maintenance cost;

(3) Replacement cost; and

(4) Salvage value.

(c) The present value of recurring costs is the product of the base year value of recurring costs as multiplied by the appropriate uniform present worth factor under §436.14, or as calculated by computer software indicated in §436.18(b) and used with the official discount rate and escalation rate assumptions under §436.14. When recurring costs begin to accrue at a later time, subtract the present value of recurring costs over the delay, calculated using the appropriate uniform present worth factor for the period of the delay, from the present value of recurring costs over the study period or, if using computer software, indicate a delayed beneficial occupancy date.

(d) The present value of non-recurring cost under §436.16(a) is the product of the non-recurring costs as multiplied by appropriate single present worth factors under §436.14 for the respective years in which the costs are expected to be incurred, or as calculated by computer software provided or approved by DOE and used with the official discount rate and escalation rate assumptions under §436.14.

[55 FR 48220, Nov. 20, 1990, as amended at 61 FR 32650, June 25, 1996]

§436.17   Establishing energy or water cost data.

(a) Each Federal agency shall establish energy costs in the base year by multiplying the total units of energy used in the base year by the price per unit of energy in the base year as determined in accordance with §436.14(c).

(b) When energy costs begin to accrue in the base year, the present value of energy costs over the study period is the product of energy costs in the base year as established under §436.17(a), multiplied by the appropriate modified uniform present worth factor adjusted for energy price escalation for the applicable region, sector, fuel type, and study period consistent with §436.14, or as calculated by computer software provided or approved by DOE and used with the official discount rate and escalation rate assumptions under §436.14. When energy costs begin to accrue at a later time, subtract the present value of energy costs over the delay, calculated using the adjusted, modified uniform present worth factor for the period of delay, from the present value of energy costs over the study period or, if using computer software, indicate a delayed beneficial occupancy date.

(c) Each Federal agency shall establish water costs in the base year by multiplying the total units of water used in the base year by the price per unit of water in the base year as determined in accordance with §436.14(c).

(d) When water costs begin to accrue in the base year, the present value of water costs over the study period is the product of water costs in the base year as established under §436.17(a), or as calculated by computer software provided or approved by DOE and used with the official discount rate and assumptions under §436.14. When water costs begin to accrue at a later time, subtract the present value of water costs over the delay, calculated using the uniform present worth factor for the period of delay, from the present value of water costs over the study period or, if using computer software, indicate a delayed beneficial occupancy date.

[55 FR 48220, Nov. 20, 1990, as amended at 61 FR 32650, June 25, 1996]

§436.18   Measuring cost-effectiveness.

(a) In accordance with this section, each Federal agency shall measure cost-effectiveness by combining cost data established under §§436.16 and 436.17 in the appropriate mode of analysis as described in §436.19 through §436.22.

(b) Federal agencies performing LCC analysis on computers shall use either the Federal Buildings Life Cycle Costing (FBLCC) software provided by DOE or software consistent with this subpart.

(c) Replacement of a building energy or water system with an energy or water conservation measure by retrofit to an existing Federal building or by substitution in the design for a new Federal building shall be deemed cost-effective if—

(1) Life cycle costs, as described by §436.19, are estimated to be lower; or

(2) Net savings, as described by §436.20, are estimated to be positive; or

(3) The savings-to-investment ratio, as described by §436.21, is estimated to be greater than one; or

(4) The adjusted internal rate of return, as described by §436.22, is estimated to be greater than the discount rate as set by DOE.

(d) As a rough measure, each Federal agency may determine estimated simple payback time under §436.23, which indicates whether a retrofit is likely to be cost effective under one of the four calculation methods referenced in §436.18(c). An energy or water conservation measure alternative is likely to be cost-effective if estimated payback time is significantly less than the useful life of that system, and of the Federal building in which it is to be installed.

(e) Mutually exclusive alternatives for a given building energy or water system, considered in determining such matters as the optimal size of a solar energy system, the optimal thickness of insulation, or the best choice of double-glazing or triple-glazing for windows, shall be compared and evaluated on the basis of life cycle costs or net savings over equivalent study periods. The alternative which is estimated to result in the lowest life cycle costs or the highest net savings shall be deemed the most cost-effective because it tends to minimize the life cycle cost of Federal building.

(f) When available appropriations will not permit all cost-effective energy or water conservation measures to be undertaken, they shall be ranked in descending order of their savings-to-investment ratios, or their adjusted internal rate of return, to establish priority. If available appropriations cannot be fully exhausted for a fiscal year by taking all budgeted energy or water conservation measures according to their rank, the set of energy or water conservation measures that will maximize net savings for available appropriations should be selected.

(g) Alternative building designs for new Federal buildings shall be evaluated on the basis of life cycle costs. The alternative design which results in the lowest life cycle costs for a given new building shall be deemed the most cost-effective.

[55 FR 48220, Nov. 20, 1990, as amended at 61 FR 32650, June 25, 1996]

§436.19   Life cycle costs.

Life cycle costs are the sum of the present values of—

(a) Investment costs, less salvage values at the end of the study period;

(b) Non-fuel operation and maintenance costs:

(c) Replacement costs less salvage costs of replaced building systems; and

(d) Energy and/or water costs.

[55 FR 48220, Nov. 20, 1990, as amended at 61 FR 32651, June 25, 1996]

§436.20   Net savings.

For a retrofit project, net savings may be found by subtracting life cycle costs based on the proposed project from life cycle costs based on not having it. For a new building design, net savings is the difference between the life cycle costs of an alternative design and the life cycle costs of the basic design.

§436.21   Savings-to-investment ratio.

The savings-to-investment ratio is the ratio of the present value savings to the present value costs of an energy or water conservation measure. The numerator of the ratio is the present value of net savings in energy or water and non-fuel or non-water operation and maintenance costs attributable to the proposed energy or water conservation measure. The denominator of the ratio is the present value of the net increase in investment and replacement costs less salvage value attributable to the proposed energy or water conservation measure.

[61 FR 32651, June 25, 1996]

§436.22   Adjusted internal rate of return.

The adjusted internal rate of return is the overall rate of return on an energy or water conservation measure. It is calculated by subtracting 1 from the nth root of the ratio of the terminal value of savings to the present value of costs, where n is the number of years in the study period. The numerator of the ratio is calculated by using the discount rate to compound forward to the end of the study period the yearly net savings in energy or water and non-fuel or non-water operation and maintenance costs attributable to the proposed energy or water conservation measure. The denominator of the ratio is the present value of the net increase in investment and replacement costs less salvage value attributable to the proposed energy or water conservation measure.

[61 FR 32651, June 25, 1996]

§436.23   Estimated simple payback time.

The estimated simple payback time is the number of years required for the cumulative value of energy or water cost savings less future non-fuel or non-water costs to equal the investment costs of the building energy or water system, without consideration of discount rates.

[61 FR 32651, June 25, 1996]

§436.24   Uncertainty analyses.

If particular items of cost data or timing of cash flows are uncertain and are not fixed under §436.14, Federal agencies may examine the impact of uncertainty on the calculation of life cycle cost effectiveness or the assignment of rank order by conducting additional analyses using any standard engineering economics method such as sensitivity and probabilistic analysis. If additional analysis casts substantial doubt on the life cycle cost analysis results, a Federal agency should consider obtaining more reliable data or eliminating the building energy or water system alternative.

[55 FR 48220, Nov. 20, 1990, as amended at 61 FR 32651, June 25, 1996]

Subpart B—Methods and Procedures for Energy Savings Performance Contracting

Source: 60 FR 18334, Apr. 10, 1995, unless otherwise noted.

§436.30   Purpose and scope.

(a) General. This subpart provides procedures and methods which apply to Federal agencies with regard to the award and administration of energy savings performance contracts awarded on or before September 30, 2003. This subpart applies in addition to the Federal Acquisition Regulation at Title 48 of the CFR and related Federal agency regulations. The provisions of this subpart are controlling with regard to energy savings performance contracts notwithstanding any conflicting provisions of the Federal Acquisition Regulation and related Federal agency regulations.

(b) Utility incentive programs. Nothing in this subpart shall preclude a Federal agency from—

(1) Participating in programs to increase energy efficiency, conserve water, or manage electricity demand conducted by gas, water, or electric utilities and generally available to customers of such utilities;

(2) Accepting financial incentives, goods, or services generally available from any such utility to increase energy efficiency or to conserve water or manage electricity demand; or

(3) Entering into negotiations with electric, water, and gas utilities to design cost-effective demand management and conservation incentive programs to address the unique needs of each Federal agency.

(c) Promoting competition. To the extent allowed by law, Federal agencies should encourage utilities to select contractors for the conduct of utility incentive programs in a competitive manner to the maximum extent practicable.

(d) Interpretations. The permissive provisions of this subpart shall be liberally construed to effectuate the objectives of Title VIII of the National Energy Conservation Policy Act, 42 U.S.C. 8287-8287c.

[60 FR 18334, Apr. 10, 1995, as amended at 60 FR 19343, Apr. 18, 1995; 65 FR 39786, June 28, 2000]

§436.31   Definitions.

As used in this subpart—

Act means Title VIII of the National Energy Conservation Policy Act.

Annual energy audit means a procedure including, but not limited to, verification of the achievement of energy cost savings and energy unit savings guaranteed resulting from implementation of energy conservation measures and determination of whether an adjustment to the energy baseline is justified by conditions beyond the contractor's control.

Building means any closed structure primarily intended for human occupancy in which energy is consumed, produced, or distributed.

Detailed energy survey means a procedure which may include, but is not limited to, a detailed analysis of energy cost savings and energy unit savings potential, building conditions, energy consuming equipment, and hours of use or occupancy for the purpose of confirming or revising technical and price proposals based on the preliminary energy survey.

DOE means Department of Energy.

Energy baseline means the amount of energy that would be consumed annually without implementation of energy conservation measures based on historical metered data, engineering calculations, submetering of buildings or energy consuming systems, building load simulation models, statistical regression analysis, or some combination of these methods.

Energy conservation measures means measures that are applied to an existing Federally owned building or facility that improves energy efficiency, are life-cycle cost-effective under subpart A of this part, and involve energy conservation, cogeneration facilities, renewable energy sources, improvements in operation and maintenance efficiencies, or retrofit activities.

Energy cost savings means a reduction in the cost of energy and related operation and maintenance expenses, from a base cost established through a methodology set forth in an energy savings performance contract, utilized in an existing federally owned building or buildings or other federally owned facilities as a result of—

(1) The lease or purchase of operating equipment, improvements, altered operation and maintenance, or technical services; or

(2) The increased efficient use of existing energy sources by cogeneration or heat recovery, excluding any cogeneration process for other than a federally owned building or buildings or other federally owned facilities.

Energy savings performance contract means a contract which provides for the performance of services for the design, acquisition, installation, testing, operation, and, where appropriate, maintenance and repair of an identified energy conservation measure or series of measures at one or more locations.

Energy unit savings means the determination, in electrical or thermal units (e.g., kilowatt hour (kwh), kilowatt (kw), or British thermal units (Btu)), of the reduction in energy use or demand by comparing consumption or demand, after completion of contractor-installed energy conservation measures, to an energy baseline established in the contract.

Facility means any structure not primarily intended for human occupancy, or any contiguous group of structures and related systems, either of which produces, distributes, or consumes energy.

Federal agency has the meaning given such term in section 551(1) of Title 5, United States Code.

Preliminary energy survey means a procedure which may include, but is not limited to, an evaluation of energy cost savings and energy unit savings potential, building conditions, energy consuming equipment, and hours of use or occupancy, for the purpose of developing technical and price proposals prior to selection.

Secretary means the Secretary of Energy.

§436.32   Qualified contractors lists.

(a) DOE shall prepare a list, to be updated annually, or more often as necessary, of firms qualified to provide energy cost savings performance services and grouped by technology. The list shall be prepared from statements of qualifications by or about firms engaged in providing energy savings performance contract services on questionnaires obtained from DOE. Such statements shall, at a minimum, include prior experience and capabilities of firms to perform the proposed energy cost savings services by technology and financial and performance information. DOE shall issue a notice annually, for publication in the Commerce Business Daily, inviting submission of new statements of qualifications and requiring listed firms to update their statements of qualifications for changes in the information previously provided.

(b) On the basis of statements of qualifications received under paragraph (a) of this section and any other relevant information, DOE shall select a firm for inclusion on the qualified list if—

(1) It has provided energy savings performance contract services or services that save energy or reduce utility costs for not less than two clients, and the firm possesses the appropriate project experience to successfully implement the technologies which it proposes to provide;

(2) Previous project clients provide ratings which are “fair” or better;

(3) The firm or any principal of the firm has neither been insolvent nor declared bankruptcy within the last five years;

(4) The firm or any principal of the firm is not on the list of parties excluded from procurement programs under 48 CFR part 9, subpart 9.4; and

(5) There is no other adverse information which warrants the conclusion that the firm is not qualified to perform energy savings performance contracts.

(c) DOE may remove a firm from DOE's list of qualified contractors after notice and an opportunity for comment if—

(1) There is a failure to update its statement of qualifications;

(2) There is credible information warranting disqualification; or

(3) There is other good cause.

(d) A Federal agency shall use DOE's list unless it elects to develop its own list of qualified firms consistent with the procedures in paragraphs (a) and (b) of this section.

(e) A firm not designated by DOE or a Federal agency pursuant to the procedures in paragraphs (a) and (b) of this section as qualified to provide energy cost savings performance services shall receive a written decision and may request a debriefing.

(f) Any firm receiving an adverse final decision under this section shall apply to the Board of Contract Appeals of the General Services Administration in order to exhaust administrative remedies.

§436.33   Procedures and methods for contractor selection.

(a) Competitive selection. Competitive selections based on solicitation of firms are subject to the following procedures—

(1) With respect to a particular proposed energy cost savings performance project, Federal agencies shall publish a Commerce Business Daily notice which synopsizes the proposed contract action.

(2) Each competitive solicitation—

(i) Shall request technical and price proposals and the text of any third-party financing agreement from interested firms;

(ii) Shall consider DOE model solicitations and should use them to the maximum extent practicable;

(iii) May provide for a two-step selection process which allows Federal agencies to make an initial selection based, in part, on proposals containing estimated energy cost savings and energy unit savings, with contract award conditioned on confirmation through a detailed energy survey that the guaranteed energy cost savings are within a certain percentage (specified in the solicitation) of the estimated amount; and

(iv) May state that if the Federal agency requires a detailed energy survey which identifies life cycle cost effective energy conservation measures not in the initial proposal, the contract may include such measures.

(3) Based on its evaluation of the technical and price proposals submitted, any applicable financing agreement (including lease-acquisitions, if any), statements of qualifications submitted under §436.32 of this subpart, and any other information determines to be relevant, the Federal agency may select a firm on a qualified list to conduct the project.

(4) If a proposed energy cost savings project involves a large facility with too many contiguously related buildings and other structures at one site for proposing firms to assume the costs of a preliminary energy survey of all such structures, the Federal agency—

(i) May request technical and price proposals for a representative sample of buildings and other structures and may select a firm to conduct the proposed project; and

(ii) After selection of a firm, but prior to award of an energy savings performance contract, may request the selected firm to submit technical and price proposals for all or some of the remaining buildings and other structures at the site and may include in the award for all or some of the remaining buildings and other structures.

(5) After selection under paragraph (a)(3) or (a)(4) of this section, but prior to award, a Federal agency may require the selectee to conduct a detailed energy survey to confirm that guaranteed energy cost savings are within a certain percentage (specified in the solicitation) of estimated energy cost savings in the selectee's proposal. If the detailed energy survey does not confirm that guaranteed energy savings are within the fixed percentage of estimated savings, the Federal agency may select another firm from those within the competitive range.

(b) Unsolicited proposals. Federal agencies may—

(1) Consider unsolicited energy savings performance contract proposals from firms on a qualified contractor list under this subpart which include technical and price proposals and the text of any financing agreement (including a lease-acquisition) without regard to the requirements of 48 CFR 15.602 and 15.602-2(a)(1); 48 CFR 15.603; and 48 CFR 15.607(a), (a)(2), (a)(3), (a)(4) and (a)(5).

(2) Reject an unsolicited proposal that is too narrow because it does not address the potential for significant energy conservation measures from other than those measures in the proposal.

(3) After requiring a detailed energy survey, if appropriate, and determining that technical and price proposals are adequate, award a contract to a firm on a qualified contractor list under this subpart on the basis of an unsolicited proposal, provided that the Federal agency complies with the following procedures—

(i) An award may not be made to the firm submitting the unsolicited proposal unless the Federal agency first publishes a notice in the Commerce Business Daily acknowledging receipt of the proposal and inviting other firms on the qualified list to submit competing proposals.

(ii) Except for unsolicited proposals submitted in response to a published general statement of agency needs, no award based on such an unsolicited proposal may be made in instances in which the Federal agency is planning the acquisition of an energy conservation measure through an energy savings performance contract.

(c) Certified cost or pricing data. (1) Energy savings performance contracts under this part are firm fixed-price contracts.

(2) Pursuant to the authority provided under section 304A(b)(1)(B) of the Federal Property and Administrative Services Act of 1049, the heads of procuring activities shall waive the requirement for submission of certified cost or pricing data. However, this does not exempt offerors from submitting information (including pricing information) required by the Federal agency to ensure the impartial and comprehensive evaluation of proposals.

[60 FR 18334, Apr. 10, 1995, as amended at 65 FR 39786, June 28, 2000]

§436.34   Multiyear contracts.

(a) Subject to paragraph (b) of this section, Federal agencies may enter into a multiyear energy savings performance contract for a period not to exceed 25 years, as authorized by 42 U.S.C. 8287, without funding of cancellation charges, if:

(1) The multiyear energy savings performance contract was awarded in a competitive manner using the procedures and methods established by this subpart;

(2) Funds are available and adequate for payment of the scheduled energy cost for the first fiscal year of the multiyear energy savings performance contract;

(3) Thirty days before the award of any multiyear energy savings performance contract that contains a clause setting forth a cancellation ceiling in excess of $750,000, the head of the awarding Federal agency gives written notification of the proposed contract and the proposed cancellation ceiling for the contract to the appropriate authorizing and appropriating committees of the Congress; and

(4) Except as otherwise provided in this section, the multiyear energy savings performance contract is subject to 48 CFR part 17, subpart 17.1, including the requirement that the contracting officer establish a cancellation ceiling.

(b) Neither this subpart nor any provision of the Act requires, prior to contract award or as a condition of a contract award, that a Federal agency have appropriated funds available and adequate to pay for the total costs of an energy savings performance contract for the term of such contract.

§436.35   Standard terms and conditions.

(a) Mandatory requirements. In addition to contractual provisions otherwise required by the Act or this subpart, any energy savings performance contract shall contain clauses—

(1) Authorizing modification, replacement, or changes of equipment, at no cost to the Federal agency, with the prior approval of the contracting officer who shall consider the expected level of performance after such modification, replacement or change;

(2) Providing for the disposition of title to systems and equipment;

(3) Requiring prior approval by the contracting officer of any financing agreements (including lease-acquisitions) and amendments to such an agreement entered into after contract award for the purpose of financing the acquisition of energy conservation measures;

(4) Providing for an annual energy audit and identifying who shall conduct such an audit, consistent with §436.37 of this subpart; and

(5) Providing for a guarantee of energy cost savings to the Federal agency, and establishing payment schedules reflecting such guarantee.

(b) Third party financing. If there is third party financing, then an energy savings performance contract may contain a clause:

(1) Permitting the financing source to perfect a security interest in the installed energy conservation measures, subject to and subordinate to the rights of the Federal agency; and

(2) Protecting the interests of a Federal agency and a financing source, by authorizing a contracting officer in appropriate circumstances to require a contractor who defaults on an energy savings performance contract or who does not cure the failure to make timely payments, to assign to the financing source, if willing and able, the contractor's rights and responsibilities under an energy savings performance contract;

§436.36   Conditions of payment.

(a) Any amount paid by a Federal agency pursuant to any energy savings performance contract entered into under this subpart may be paid only from funds appropriated or otherwise made available to the agency for the payment of energy expenses and related operation and maintenance expenses which would have been incurred without an energy savings performance contract. The amount the agency would have paid is equal to:

(1) The energy baseline under the energy savings performance contract (adjusted if appropriate under §436.37), multiplied by the unit energy cost; and

(2) Any related operations and maintenance cost prior to implementation of energy conservation measures, adjusted for increases in labor and material price indices.

(b) Federal agencies may incur obligations pursuant to energy savings performance contracts to finance energy conservation measures provided guaranteed energy cost savings exceed the contractor's debt service requirements.

§436.37   Annual energy audits.

(a) After contractor implementation of energy conservation measures and annually thereafter during the contract term, an annual energy audit shall be conducted by the Federal agency or the contractor as determined by the contract. The annual energy audit shall verify the achievement of annual energy cost savings performance guarantees provided by the contractor.

(b) The energy baseline is subject to adjustment due to changes beyond the contractor's control, such as—

(1) Physical changes to building;

(2) Hours of use or occupancy;

(3) Area of conditioned space;

(4) Addition or removal of energy consuming equipment or systems;

(5) Energy consuming equipment operating conditions;

(6) Weather (i.e., cooling and heating degree days); and

(7) Utility rates.

(c) In the solicitation or in the contract, Federal agencies shall specify requirements for annual energy audits, the energy baseline, and baseline adjustment procedures.

§436.38   Terminating contracts.

(a) Except as otherwise provided by this subpart, termination of energy savings performance contracts shall be subject to the termination procedures of the Federal Acquisition Regulation in 48 CFR part 49.

(b) In the event an energy savings performance contract is terminated for the convenience of a Federal agency, the termination liability of the Federal agency shall not exceed the cancellation ceiling set forth in the contract, for the year in which the contract is terminated.

Subpart C—Agency Procurement of Energy Efficient Products

Source: 74 FR 10835, Mar. 13, 2009, unless otherwise noted.

§436.40   Purpose and scope.

This subpart provides guidance to promote the procurement of energy efficient products by Federal agencies and promote procurement practices which facilitate the procurement of energy efficient products, consistent with the requirements in section 553 of the National Energy Conservation Policy Act. (42 U.S.C. 8259b)

§436.41   Definitions.

Agency means each authority of the Government of the United States, whether or not it is within or subject to review by another agency, but does not include—

(1) The Congress, and agencies thereof;

(2) The courts of the United States;

(3) The governments of the territories or possessions of the United States; or

(4) The government of the District of Columbia.

Covered product means a product that is of a category for which an ENERGY STAR qualification or FEMP designation is established.

ENERGY STAR qualified product means a product that is rated for energy efficiency under an ENERGY STAR program established by section 324A of the Energy Policy and Conservation Act (42 U.S.C. 6294a).

FEMP designated product means a product that is designated under the Federal Energy Management Program as being among the highest 25 percent of equivalent products for energy efficiency.

§436.42   Evaluation of Life-Cycle Cost Effectiveness.

For the purpose of compliance with section 553 of the National Energy Conservation Policy Act:

(a) ENERGY STAR qualified and FEMP designated products may be assumed to be life-cycle cost-effective.

(b) In making a determination that a covered product is not life-cycle cost-effective, an agency should rely on the life-cycle cost analysis method in part 436, subpart A, of title 10 of the Code of Federal Regulations.

§436.43   Procurement planning.

(a) Agencies should consider the procurement planning requirements of section 553 of the National Energy Conservation Policy Act as applying to:

(1) Design, design/build, renovation, retrofit and services contracts; facility maintenance and operations contracts;

(2) Energy savings performance contracts and utility energy service contracts;

(3) If applicable, lease agreements for buildings or equipment, including build-to-lease contracts;

(b) Agencies should require the procurement of ENERGY STAR and FEMP designated products in new service contracts and other existing service contracts as they are recompeted and should, to the extent possible, incorporate such requirements and preferences into existing contracts as they are modified or extended through options.

(c) Agencies should include criteria for energy efficiency that are consistent with the criteria used for rating qualified products in the factors for the evaluation of:

(1) Offers received for procurements involving covered products, and

(2) Offers received for construction, renovation, and services contracts that include provisions for covered products.

(d) Agencies should notify their vendors of the Federal requirements for energy efficient purchasing.

Subparts D-E [Reserved]

Subpart F—Guidelines for General Operations Plans

Authority: Energy Policy and Conservation Act, as amended, 42 U.S.C. 6361; Executive Order 11912, as amended, 42 FR 37523 (July 20, 1977); National Energy Conservation Policy Act, title V, part 3, 42 U.S.C. 8251 et seq.; Department of Energy Organization Act, 42 U.S.C. 7254.

Source: 45 FR 44561, July 1, 1980, unless otherwise noted.

§436.100   Purpose and scope.

(a) Purpose. The purpose of this subpart is to provide guidelines for use by Federal agencies in their development of overall 10-year energy management plans to establish energy conservation goals, to reduce the rate of energy consumption, to promote the efficient use of energy, to promote switching for petroleum-based fuels and natural gas to coal and other energy sources, to provide a methodology for reporting their progress in meeting the goals of those plans, and to promote emergency energy conservation planning to assuage the impact of a sudden disruption in the supply of oil-based fuels, natural gas or electricity. The plan is intended to provide the cornerstone for a program to conserve energy in the general operations of an agency.

(b) Scope. This subpart applies to all general operations of Federal agencies and is applicable to management of all energy used by Federal agencies that is excluded from coverage pursuant to section 543(a)(2) of part 3 of title V of the National Energy Conservation Policy Act, as amended (42 U.S.C. 8251-8261).

[45 FR 44561, July 1, 1980, as amended at 55 FR 48223, Nov. 20, 1990]

§436.101   Definitions.

As used in this subpart—

Automotive gasoline means all grades of gasoline for use in internal combustion engines except aviation gasoline. Does not include diesel fuel.

Aviation gasoline (AVGAS) means all special grades of gasoline for use in aviation reciprocating engines.

Btu means British thermal unit; the quantity of heat required to raise the temperature of one pound of water one degree Fahrenheit.

Cogeneration means the utilization of surplus energy, e.g., steam, heat or hot water produced as a by-product of the manufacture of some other form of energy, such as electricity. Thus, diesel generators are converted to cogeneration sets when they are equipped with boilers that make steam and hot water (usable as energy) from the heat of the exhaust and the water that cools the generator.

Diesel and petroleum distillate fuels means the lighter fuel oils distilled-off during the refining process. Included are heating oils, fuels, and fuel oil. The major uses of distillate fuel oils include heating, fuel for on- and off-highway diesel engines, marine diesel engines and railroad diesel fuel.

DOE means the Department of Energy.

Emergency conservation plan means a set of instructions designed to specify actions to be taken in response to a serious interruption of energy supply.

Energy efficiency goal means the ratio of production achieved to energy used.

Energy use avoidance means the amount of energy resources, e.g., gasoline, not used because of initiatives related to conservation. It is the difference between the baseline without a plan and actual consumption.

Facility means any structure or group of closely located structures, comprising a manufacturing plant, laboratory, office or service center, plus equipment.

Federal agency means any Executive agency under 5 U.S.C. 105 and the United States Postal Service, each entity specified in 5 U.S.C. 5721(1) (B) through (H) and, except that for purposes of this subpart, the Department of Defense shall be separated into four reporting organizations: the Departments of the Army, Navy and Air Force and the collective DOD agencies, with each responsible for complying with the requirements of this subpart.

Fiscal year or FY means, for a given year, October 1 of the prior year through September 30 of the given year.

Fuel types means purchased electricity, fuel oil, natural gas, liquefied petroleum gas, coal, purchased steam, automotive gasoline, diesel and petroleum distillate fuels, aviation gasoline, jet fuel, Navy special, and other identified fuels.

General operations means world-wide Federal agency operations, other than building operations, and includes services; production and industrial activities; operation of aircraft, ships, and land vehicles; and operation of Government-owned, contractor-operated plants.

General transportation means the use of vehicles for over-the-road driving as opposed to vehicles designed for off-road conditions, and the use of aircraft and vessels. This category does not include special purpose vehicles such as combat aircraft, construction equipment or mail delivery vehicles.

Goal means a specific statement of an intended energy conservation result which will occur within a prescribed time period. The intended result must be time-phased and must reflect expected energy use assuming planned conservation programs are implemented.

Guidelines means a set of instructions designed to prescribe, direct and regulate a course of action.

Industrial or production means the operation of facilities including buildings and plants which normally use large amounts of capital equipment, e.g., GOCO plants, to produce goods (hardware).

Jet fuel means fuels for use, generally in aircraft turbine engines.

Life cycle cost means the total cost of acquiring, operating and maintaining equipment over its economic life, including its fuel costs, determined on the basis of a systematic evaluation and comparison of alternative investments in programs, as defined in subpart A of this part.

Liquefied petroleum gas means propane, propylene-butanes, butylene, propane-butane mixtures, and isobutane that are produced at a refinery, a natural gas processing plant, or a field facility.

Maintenance means activities undertaken to assure that equipment and energy-using systems operate effectively and efficiently.

Measures means actions, procedures, devices or other means for effecting energy efficient changes in general operations which can be applied by Federal agencies.

Measure of performance means a scale against which the fulfillment of a requirement can be measured.

Navy special means a heavy fuel oil that is similar to ASTM grade No. 6 oil or Bunker C oil. It is used to power U.S. Navy ships.

Non-renewable energy source means fuel oil, natural gas, liquefied petroleum gas, synthetic fuels, and purchased steam or electricity, or other such energy sources.

Operational training and readiness means those activities which are necessary to establish or maintain an agency's capability to perform its primary mission. Included are major activities to provide essential personnel strengths, skills, equipment/supply inventory and equipment condition. General administrative and housekeeping activities are not included.

Overall plan means the comprehensive agency plan for conserving fuel and energy in all operations, to include both the Buildings Plan developed pursuant to subpart C of this part and the General Operations Plan.

Plan means those actions which an agency envisions it must undertake to assure attainment of energy consumption and efficiency goals without an unacceptably adverse impact on primary missions.

Program means the organized set of activities and allocation of resources directed toward a common purpose, objective, or goal undertaken or proposed by an agency in order to carry out the responsibilities assigned to it.

Renewable energy sources means sunlight, wind, geothermal, biomass, solid wastes, or other such sources of energy.

Secretary means the Secretary of the Department of Energy.

Services means the provision of administrative assistance or something of benefit to the public.

Specific Functional Category means those Federal agency activities which consume energy, or which are directly linked to energy consuming activities and which fall into one of the following groups: Services, General Transportation, Industrial or Production, Operational Training and Readiness, and Others.

Standard means an energy conservation measure determined by DOE to be applicable to a particular agency or agencies. Once established as a standard, any variance or decision not to adopt the measure requires a waiver.

Under Secretary means the Under Secretary of the Department of Energy.

Variance means the difference between actual consumption and goal.

656 Committee means the Interagency Federal Energy Policy Committee, the group designated in section 656 of the DOE Organization Act to provide general oversight for interdepartmental FEMP matters. It is chaired by the Under Secretary of DOE and includes the designated Assistant Secretaries or Assistant Administrator of the Department of Defense, Commerce, Housing and Urban Development, Transportation, Agriculture, Interior and the U.S. Postal Service and General Services Administration, along with similar level representatives of the National Aeronautics and Space Administration and the Veterans Administration.

§436.102   General operations plan format and content.

(a) Each Federal agency shall prepare and submit to the Under Secretary, DOE, within six months from the effective date of these guidelines, a general operations 10-year plan which shall consist of two parts, an executive summary and a text. Subsequent agency revisions to plans shall be included in each agency's annual report on progress which shall be forwarded to DOE by July 1 annually.

(b) The following information shall be included in each Federal agency general operations 10-year plan for the period of fiscal years 1980-1990:

(1) An Executive Summary which includes—

(i) A brief description of agency missions, and applicable functional categories pursuant to §436.106(a)(2);

(ii) A Goals and Objectives Section which summarizes what energy savings or avoidance will be achieved during the plan period, and what actions will be taken to achieve those savings, and the costs and benefits of measures planned for reducing energy consumption, increasing energy efficiencies, and shifting to a more favorable fuel mix. Assumptions of environmental, safety and health effects of the goals should be included;

(iii) A chart depicting the agency organizational structure for energy management, showing energy management program organization for headquarters and for major subordinate elements of the agency;

(iv) A schedule for completion of requirements directed in this subpart, including phase-out of any procedures made obsolete by these guidelines; and

(v) Identification of any significant problem which may impede the agency from meeting its energy management goals.

(2) A Text which includes—

(i) A Goals and Objectives Section developed pursuant to §436.103 describing agency conservation goals; these goals will be related to primary mission goals;

(ii) An Investment Section describing the agency planned investment program by fiscal year, pursuant to appendix B of this subpart, all measures selected pursuant to §436.104, and the estimated costs and benefits of the measures planned for reducing energy consumption and increasing energy efficiencies;

(iii) An Organization Section which includes: (A) Designation of the principal energy conservation officer, such as an Assistant Secretary or Assistant Administrator, who is responsible for supervising the preparation, updating and execution of the Plan, for planning and implementation of agency energy conservation programs, and for coordination with DOE with respect to energy matters; (B) designation of a middle-level staff member as a point of contact to interface with the DOE Federal Programs Office at the staff level; and (C) designation of key staff members within the agency who are responsible for technical inputs to the plan or monitoring progress toward meeting the goals of the plan;

(iv) An Issues Section addressing problems, alternative courses of action for resolution, and agency recommendations that justify any decisions not to plan for or implement measures contained in appendix C of this subpart, and identifying any special projects, programs, or administrative procedures which may be beneficial to other Federal agency energy management programs:

(v) An implementing Instructions Section which includes a summary of implementing instructions issued by agency headquarters, and attachments of appropriate documents such as:

(A) Specific tasking resulting from development of the Plan;

(B) Guidance for the development of emergency conservation plans;

(C) Task milestones;

(D) Listing of responsible sub-agencies and individuals at both agency headquarters and subordinate units;

(E) Reporting and administrative procedures for headquarters and subordinate organizations;

(F) Report schedules pursuant to §436.106(c);

(G) Schedules for feedback in order to facilitate plan updating, to include reviews of emergency conservation plans developed pursuant to §436.105;

(H) Schedules for preparing and submitting the annual report on energy management pursuant to §436.106(a);

(I) Schedules of plan preparation and publication;

(J) Communication, implementation, and control measures such as inspections, audits, and others; and

(vi) An Emergency Conservation Plan Summary Section pursuant to the requirements of §436.105(d).

(3) Appendices which are needed to discuss and evaluate any innovative energy conserving technologies or methods, not included in this part, which the agency has identified for inclusion in its plan.

(c) Each plan must be approved and signed by the principal energy conservation officer designated pursuant to paragraph (b)(2) of this section.

§436.103   Program goal setting.

(a) In developing and revising plans for a projected 10-year plan each agency shall establish and maintain energy conservation goals in accordance with the requirements of this section.

(b) Agencies shall establish three types of conservation goals:

(1) Energy consumption goals, by fuel type by functional category (see appendix B).

(2) Energy efficiency goals by fuel type by functional category (see appendix B).

(3) Fuel switching goals for shifting energy use from oil and natural gas to other fuels in more plentiful supply from domestic sources (see appendix B).

(c) General operations energy conservation goals shall be established by each Federal agency with the broad purpose of achieving reductions in total energy consumption and increased efficiency without serious mission degradation or unmitigated negative environmental impacts. Within the broad framework, each agency should seek first to reduce energy consumption per unit of output in each applicable functional category. In evaluating energy efficiency, each agency should select and use standards of measurement which are consistent throughout the planning period. Particular attention should be given to increased energy use efficiency in nonrenewable fuel consumption. The second focus of attention should be on initiatives which shift energy use from oil and natural gas to other fuels in more plentiful supply from domestic sources.

§436.104   Energy conservation measures and standards.

(a) Each agency shall consider for inclusion in its plan the measures identified in appendix C of this subpart.

(b) The following questions should be considered in the evaluation of each measure:

(1) Does this measure provide an incentive or disincentive?

(2) What is the estimate of savings by fuel type?

(3) What are the direct and indirect impacts of this measure?

(4) Is this measure to be mandatory throughout the agency?

(5) If not mandatory, under what circumstances will it be implemented, and who will be responsible for determining specific applicability?

(6) Who will be the direct participants in the implementation of this measure?

(7) What incentives (if any) are to be provided for the participants?

(8) When will this measure be implemented?

(9) Will this measure be implemented in a single step or will it be phased in? If it will be phased in, over what period of time?

(10) Will performance of the measure be evaluated and reported?

(11) By what criterion will performance be determined?

(12) Who will prepare performance reports?

(13) What is the reporting chain?

(14) What is the reporting period?

(c) Each agency will take all necessary steps to implement the energy conservation standards for general operations listed in appendix A (reserved).

§436.105   Emergency conservation plan.

(a) Each agency shall establish an emergency conservation plan, a summary of which shall be included in the general operations plan, for assuaging the impact of a sudden disruption in the supply of oil-based fuels, natural gas or electricity. Priorities for temporarily reducing missions, production, services, and other programmatic or functional activities shall be developed in accordance with paragraph (b) of this section. Planning for emergencies is to address both buildings and general operations. Provisions shall be made for testing emergency actions to ascertain that they are effective.

(b) Federal agencies shall prepare emergency conservation plans for 10 percent, fifteen percent, and 20 percent reduction compared to the previous fiscal year in gasoline, other oil-based fuels, natural gas, or electricity for periods of up to 12 months. In developing these plans, agencies shall consider the potential for emergency reductions in energy use in buildings and facilities which the agency owns, leases, or has under contract and by employees through increased use of car and van pooling, preferential parking for multipassenger vehicles, and greater use of mass transit. Agencies may formulate whatever additional scenarios they consider necessary to plan for various energy emergencies.

(c) In general, Federal agencies' priorities shall go to those activities which directly support the agencies' primary missions. Secondary mission activities which must be curtailed or deferred will be reported to DOE as mission impacts. The description of mission impacts shall include estimates of the associated resources and time required to mitigate the effects of the reduction in energy. Other factors or assumptions to be used in energy conservation emergency planning are as follows:

(1) Agencies will be given 15-30 days notice to implement any given plan.

(2) Substitution of fuels in plentiful supply for fuels in short supply is authorized, if the substitution can be completed within a 3-month period and the cost is within the approval authority of the executive branch.

(3) All costs and increases in manpower or other resources associated with activities or projects to assuage mission impacts will be clearly defined in respective agency plans. One-time costs will be identified separately.

(4) Confronting the emergency situation will be considered a priority effort and all projects and increases in operating budgets within the approval authority of the executive branch will be expeditiously considered and approved if justified.

(d) Summary plans for agency-wide emergency conservation management shall be provided to DOE pursuant to §436.102(b)(2)(vi). Such summaries shall include:

(1) Agency-wide impacts of energy reductions as determined in accordance with paragraph (b) of this section.

(2) Actions to be taken agency-wide to alleviate the energy shortfalls as they occur.

(3) An assessment of agency services or production that may need to be curtailed or limited after corrective actions have been taken.

(4) A summation of control and feedback mechanisms for managing an energy emergency situation.

§436.106   Reporting requirements.

(a) By July 1 of each year each Federal agency shall submit an “Annual Report on Energy Management” based on fiscal year data to the Secretary of DOE. The general operations portion of this report will encompass all agency energy use not reported in the buildings portion and shall include:

(1) A summary evaluation of progress toward the achievement of energy consumption, energy efficiency, and fuel switching goals established by the agency in its plans;

(2) Energy consumption reported by functional categories. Reports must include General Transportation and one or more of the following functional categories: industrial or production, services, operational training and readiness, and other. Agencies may report in subcategories of their own choosing. The following information is to be reported for the usage of each fuel type in physical units for each selected functional category:

(i) Total energy consumption goal;

(ii) Total energy consumed;

(iii) Total energy use avoidance;

(iv) Variance between actual consumption and consumption goal;

(v) Cost saved;

(vi) Status of planned investments, and if different from the investment program upon which existing goals are based, the expected impact on meeting goals; and

(vii) Summary of any other benefits realized.

(3) The energy efficiencies as calculated in accordance with appendix B of this subpart, or by an equivalent method, for the appropriate functional categories identified in paragraph (a)(2) of this section. The following information is to be reported for the energy efficiency for each fuel type by functional category:

(i) Energy efficiency goal;

(ii) Efficiency for the reporting period;

(iii) Summary of any other benefits realized.

(4) A summary of fuel switching progress including:

(i) Description and cost of investments in fuel switching;

(ii) Avoidance in use of oil-based fuels and natural gas;

(iii) Increased use of solar, wood, gasohol and other renewable energy sources;

(iv) Increased use of coal and coal derivatives, and

(v) Use of all other alternative fuels.

(b) Each agency's annual report shall be developed in accordance with a format to be provided by DOE and will include agency revisions to 10-year plans.

(c) Agencies whose annual total energy consumption exceeds one hundred billion Btu's, shall, in addition to the annual report required under paragraph (a) of this section, submit quarterly reports of the energy usage information specified in paragraph (a)(2) of this section.

(d) Agencies who consume energy in operations in foreign countries will include data on foreign operations if foreign consumption is greater than 10% of that consumed by the agency in the United States, its territories and possessions. If an agency's estimated foreign consumption is less than 10% of its total domestic energy use, reporting of foreign consumption is optional. Reports should be annotated if foreign consumption is not included.

[45 FR 44561, July 1, 1980, as amended at 51 FR 4586, Feb. 6, 1986]

§436.107   Review of plan.

(a) Each plan or revision of a plan shall be submitted to DOE and DOE will evaluate the sufficiency of the plan in accordance with the requirements of this subpart. Written notification of the adequacy of the plan including a critique, will be made by DOE and sent to the agency submitting the plan or revision within 60 days of submission. Agencies shall be afforded an opportunity to modify and return the plan within an appropriate period of time for review by DOE.

(b) A general operations plan under the guidelines will be evaluated with respect to:

(1) Adequacy of information or plan content required to be included by §436.102;

(2) Adequacy of goal setting methodology or baseline justification as stated in §436.103;

(3) Adequacy of a well-justified investment program which considers all measures included in appendix C of this subpart; and

(4) Other factors as appropriate.

(c) After reviewing agency plans or revisions of plans, the Under Secretary of DOE, may submit to the “656” Committee for its recommendation, major problem areas or common deficiencies.

(d) Status of the plan review, the Under Secretary's decisions, and “656” Committee recommendations, will be published as appropriate in the DOE annual report to the President, titled “Energy Management in the Federal Government.”

§436.108   Waivers.

(a) Any Federal agency may submit a written request to the Under Secretary for a waiver from the procedures and requirements of this subpart. The request for a waiver must identify the specific requirements and procedures of this subpart from which a waiver is sought and provide a detailed explanation, including appropriate information or documentation, as to why a waiver should be granted.

(b) A request for a waiver under this section must be submitted at least 60 days prior to the due date for the required submission.

(c) A written response to a request for a waiver will be issued by the Under Secretary no later than 30 days from receipt of the request. Such a response will either (1) grant the request with any conditions determined to be necessary to further the purposes of this subpart, (2) deny the request based on a determination that the reasons given in the request for a waiver do not establish a need that takes precedence over the futherance of the purposes of this subpart, or (3) deny the request based on the failure to submit adequate information upon which to grant a waiver.

(d) A requested waiver may be submitted by the Under Secretary to the “656” Committee for its review and recommendation. The agency official that submitted the request may attend any scheduled meeting of the “656” Committee at which the request is planned to be discussed. The determination to approve or disapprove a request for a waiver shall be made by the Under Secretary.

(e) Status of the requests for a waiver, the Under Secretary's decisions, and “656” Committee recommendations, will be published, as appropriate, in the DOE annual report to the President, entitled “Energy Management in the Federal Government.”

Appendix A to Part 436—Energy Conservation Standards for General Operations [Reserved]

Appendix B to Part 436—Goal Setting Methodology

In establishing and updating agency goals for energy conservation, the following methodology or an equivalent method should be utilized:

(a) For overall energy consumption—

(1) An analysis shall be made to determine what factors have the most significant impact upon the amount of each fuel type used by the agency in performing functions in support of its overall mission. Consideration is to be given, but not limited to, the following factors: Number of people using energy; number of vehicles using gasoline; amounts of other equipment using energy; tempo of operations (one, two, or three shifts); the type of operations (degree of equipment or labor intensity); equipment fuel limitations; environmental conditions (tropical versus arctic, etc.); budget levels for fuel, operations, maintenance, and equipment acquisition; and phase-out schedule (of older equipment or plants which may be inefficient). After identifying these factors, a further analysis shall be made to identify any projected workload changes in the quality or quantity of these factors on a yearly basis up to 1990.

(2) Based upon the analysis in (a)(1) and an evaluation of available information on past energy usage, a baseline of energy use by fuel type by functional category shall be established beginning with FY 1975. In addition to “General Transportation,” other functional categories should be selected to enhance energy management. Total fuel use for a particular activity may be allocated to the functional category for which the preponderance of fuel is used. Figure B-1 is an example of one such baseline.

eCFR graphic ec04oc91.241.gif

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This example shows an increase in energy use, for a specific fuel type, during the period 1975-1981, with a further increase from 1981 to 1984 and a leveling off and no growth from 1984-1990. A justification, based on factors as discussed above, shall accompany each baseline.

(3) Thereafter, analyses should be made of the measures available for reducing the energy consumption profiles without adverse impact on mission accomplishment. Finding viable opportunities for reducing energy use, increasing energy efficiency and switching energy sources, will require consultation with specialists in the fields of operations, maintenance, engineering, design, and economics, and consideration of the measures identified in appendix C. The DOE Federal Energy Management Programs Office can, upon request, provide information on where such resources can be located. Once these measures are identified, they are to be incorporated into a time-phased investment program, (using where appropriate, the life cycle costing factors and methodology in subpart A of this part). If investment and other costs for implementing a measure are insignificant, a Federal agency may presume that a measure is cost-effective without further analysis. An estimate must then be made as to the lead time required to implement the program and realize energy reductions.

Figure B-2 shows a summarized investment program, which should be accompanied by a detailed description of the measures, projects, and programs making up the total planned investments for each year. This summary need not be by function or fuel type.

eCFR graphic ec04oc91.242.gif

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These analyses should enable the agency to project an energy consumption goal, with the assumption that funds for executing the planned projects will be approved. Figure B-3 shows a new energy use profile, with planned initiatives and related investments taken into consideration, and the resulting goal entitled “Energy Use With A Plan” superimposed on Figure B-1. Included are the anticipated effects on consumption cause by improvements in energy efficiency and fuel switching.

eCFR graphic ec04oc91.243.gif

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A comparison of these projections will show the energy use avoidance resulting from the investment program as depicted in Figure B-2. Using the prices of fuel contained in appendix C to subpart A, the dollars saved can be projected against the dollars invested. Life cycle costing methodology pursuant to subpart A, will be used to determine priorities for submitting individual initiatives into the appropriate budget year.

(b) For energy efficiencies—Energy efficiency baselines and goals for each fuel type shall be calculated using the same consumption factors and similar methodology to that outlined in paragraph (a). Energy consumption by fuel type shall be linked to mission through the functional categories listed in §436.106(a)(2). This will identify a rate which will indicate energy efficiency trends. This linkage may be accomplished through the following algorithm:

Step 1: Determine functional categories from section 436.106(a)(2) which best describe the Agency overall mission.

Step 2: Determine types of fuels used to support the functions selected in Step 1.

Step 3: Determine quantities of fuel consumed or planned for consumption over a specific period of time.

Step 4: Determine quantity of output of function for same period of time used in Step 3. Quantify output in a standard measure which best describes functional category.

Step 5: Determine the energy efficiency ratio by dividing quantity from Step 4 by quantity from Step 3.

This ratio of fuel consumed to a unit measure of output will be used to develop a projection of a baseline and goals through 1990, and used in reporting variance. Examples of ratios that should be considered are:

  Production or industrial process type operations

Ton of product

Cu. ft. of natural gas

  Services, such as postal delivery

Customers served or

pounds delivered

Gallons of automotive

gasoline

  General transportation

Passenger miles

Gallons of automotive gasoline

  Training

Persons trained

or in training

Gallons of navy special

Agencies shall select one or more of these ratios, which shall be used throughout the planning period, or use more appropriate energy efficiency ratios, to describe their overall functions. Figure B-4 illustrates the planning baseline and goal resulting from this type of analysis.

eCFR graphic ec04oc91.244.gif

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(c) For fuel switching—Fuel switching goals for gasoline other oil-based fuel and natural gas may be calculated as follows:

Step 1: For each fiscal year, identify investments, where appropriate, in fuel switching from gasoline, other oil-based fuel and natural gas to alternate renewable or nonrenewable fuel sources.

Step 2: Project for each fiscal year, the avoidance in the use of gasoline, other oil-based fuel and natural gas resulting from previous fuel switching investments.

Completion of these steps will permit the formulation of charts such as that shown in Figure B-5.

eCFR graphic ec04oc91.245.gif

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Appendix C to Part 436—General Operations Energy Conservation Measures

(a) The following individual measures or set of measures must be considered for inclusion in each agency 10-year energy management plan:

(1) Federal Employee Ridesharing Programs—Includes the use of vanpooling and carpooling and complies with existing orders and regulations governing parking for vanpools and carpools.

(2) Fleet Profile Change—Includes energy considerations in equipment selection and assignment.

(3) Fleet Mileage Efficiency—Includes agency plans to implement existing orders, goals, and laws related to vehicle fuel economy.

(4) Driver Training—Includes development of appropriate programs for training operators of U.S. Government vehicles in energy conservation.

(5) Maintenance Procedures Improvement—Includes activities to insure proper vehicle maintenance to optimize energy conservation.

(6) Operating Procedures Improvement—Includes use of cooperative passenger shuttle and courier services on an interagency or other basis within each metropolitan area.

(7) Mass Transit—Includes employee use of existing services for business-related activities and commuting.

(8) Public Education to Promote Vanpooling and Carpooling—Includes activities to support the EPCA requirement to establish “responsible public education programs to promote vanpooling and carpooling arrangements” through their employee awareness programs.

(9) Elimination of Free or Subsidized Employee Parking—Includes elimination of free or subsidized employee parking on Federal installations in accordance with OMB Cir. A-118, August 13, 1979.

(10) Two-Wheeled Vehicle Programs—Includes activities to encourage the substitution of bicycles, mopeds, etc. for automobiles for commuting and operational purposes. These may include the establishment of weather-protected secure storage facilities, shower and locker facilities, and restricted routes for these vehicles on Federal property. Cooperative programs with local civil authorities may also be included.

(11) Consolidation of Facilities and Process Activities—Includes such measures as physical consolidation of operations to minimize intra-operational travel and may include facility closure or conversion. Alternative work patterns, availability of transportation, energy source availability, and technical and financial feasibility are among the considerations that should be evaluated.

(12) Agency Procurement Programs—Includes activities to ensure that energy conservation opportunities are fully exploited with respect to the agency's procurement programs including procurements relating to operations and maintenance activities; e.g., (a) giving preference to fuel-efficient products whenever practicable, and (b) ensuring that agency's contractors having a preponderance of cost-type contracts pursue a comprehensive energy conservation program.

(13) Energy Conservation Awareness Programs—Includes programs aimed toward gaining and perpetuating employee awareness and participation in energy conservation measures on the job and in their personal activities.

(14) Communication—Includes substitution of communications for physical travel.

(15) Dress Code—Includes measures to allow employees greater freedom in their choice of wearing apparel to promote greater participation in conservation.

(16) Land Use—Includes energy considerations to be employed in new site selection, such as colocation.

(17) Automatic Data Processing (ADP)—Includes all energy aspects of ADP operation and equipment selection.

(18) Aircraft Operations—Includes energy-conserving measures developed for both military and Federal administrative and research and development aircraft operations.

(19) GOCO Facilities and Industrial Plants Operated by Federal Employees—Includes development of energy conservation plans at these facilities and plants which contain measures such as energy efficient periodic maintenance.

(20) Energy Conserving Capital Plant and Equipment Modification—Includes development of energy conservation and life cycle cost parameter measures for replacement of capital plant and equipment.

(21) Process Improvements—Includes measures to improve energy conservation in industrial process operations. These may include consideration of equipment replacement or modification, as well as scheduling and other operational changes.

(22) Improved Steam Maintenance and Management—Includes measures to improve energy efficiency of steam systems. These may include improved maintenance, installation of energy-conserving devices, and the operational use of substitutes for live steam where feasible.

(23) Improvements in Waste Heat Recovery—Includes measures utilizing waste heat for other purposes.

(24) Improvement in Boiler Operations—Includes energy-conserving retrofit measures for boiler operations.

(25) Improved Insulation—Includes measures addressing the addition or replacement of insulation on pipes, storage tanks, and in other appropriate areas.

(26) Scheduling by Major Electric Power Users—Includes measures to shift major electrical power demands to non-peak hours, to the maximum extent possible.

(27) Alternative Fuels—Includes measures to alter equipment such as generators to use lower quality fuels and to fill new requirements with those that use alternative fuels. The use of gasohol in stationary gasoline-powered equipment should be considered, in particular.

(28) Cogeneration—Includes measures to make full use of cogeneration in preference to single-power generation.

(29) Mobility Training and Operational Readiness—Includes measures which can reduce energy demands through the use of simulators, communications, computers for planning, etc.

(30) Energy Conservation Inspection or Instruction Teams—Includes measures which formulate and perpetuate the review of energy conservation through inspections to determine where specific improvements can be made and then followed by an instruction and training program.

(31) Intra-agency and Interagency Information Exchange Program—Includes measures providing a free exchange of energy conservation ideas and experiences between elements of an agency and between other agencies in the same geographic area.

(32) Recycled Waste—Includes measures to recycle waste materials such as paper products, glass, aluminum, concrete and brick, garbage, asphalt road materials or any material which requires a petroleum base.

(33) Fuel Conversion—Includes measures to accomplish conversion from petroleum based fuels and natural gas to coal and other alternative fuels for appropriate equipment.

(34) Operational Lighting—Includes measures to reduce energy consumption for lighting in operational areas and GOCO plants by: switching off by means of automatic controls; maximizing the use of daylight by floor planning; keeping window and light fixtures clean and replacing fixtures when they begin to deteriorate, rather than when they fail altogether; providing automatic dimmer controls to reduce lighting when daylight increases; and cleaning the work area during daylight, if possible, rather than at night.

(35) Lighting Fixtures—Includes measures to increase energy efficiency of lighting. The following reveals the relative efficiencies of common lamp types.

Lamp typeLumens wattImprovement over tungsten
Tungsten lamp12X1
Modern fluorescent lamp85X7
Mercury halide lamp100X8
High pressure sodium lamp110X9
Low pressure sodium lamp180X15

(36) Industrial Buildings Heating—Includes measures to improve the energy conservation of industrial buildings such as: fixing holes in roofs, walls and windows; fitting flexible doors, fitting controls to heating systems; use of “economizer units” which circulate hot air back down from roof level to ground level; use of controlled ventilation; insulation of walls and roof; use of “optimisers” or optimum start controls in heating systems, so that the heating switch-on is dictated by actual temperature conditions rather than simply by time.

(37) Hull Cleaning and Antifouling Coating—Includes measures to reduce energy consumption through periodic cleaning of hulls and propellers or through the use of antifouling coatings.

(38) [Reserved]

(39) Building Temperature Restrictions on Thermostat Setting for Heating, Cooling and Hot Water—Includes enforcement of suggested restriction levels: 65 degrees for heating, 78 degrees for cooling, and 105 degrees or ban for hot water.

(40) Such other measures as DOE may from time-to-time add to this appendix, or as the Federal agency concerned may find to be energy-saving or efficient.

Appendix D to Part 436—Energy Program Conservation Elements

(a) In all successful energy conservation programs, certain key elements need to be present. The elements listed below must be incorporated into each agency conservation program and must be reflected in the 10-year plan prescribed in §436.102. Those organizations that have already developed programs should review them to determine whether the present management systems incorporate these elements.

(1) Top Management Control. Top management must have a personal and sustained commitment to the program, provide active direction and motivation, and require regular review of overall energy usage at senior staff meetings.

(2) Line Management Accountability. Line managers must be accountable for the energy conservation performance of their organizations and should participate in establishing realistic goals and developing strategies and budgets to meet these goals.

(3) Formal Planning. An overall 10-year plan for the period 1980-1990 must be developed and formalized which sets forth performance-oriented conservation goals, including the categorized reduction in rates of energy consumption that the program is expected to realize. The plan will be supplemented by guidelines enumerating specific conservation procedures that will be followed. These procedures and initiatives must be life cycle cost-effective as well as energy efficient.

(4) Goals. Goals must be established in a measurable manner to answer questions of “Where are we?” “Where do we want to go?” “Are we getting there?” and “Are our initiatives for getting there life cycle cost-effective?”

(5) Monitoring. Progress must be reviewed periodically both at the agency headquarters and at local facility levels to identify program weakness or additional areas for conservation actions. Progress toward achievement of goals should be assessed, and explanations should be required for non-achievement or unusual variations in energy use. Monitoring should include personal inspections and staff visits, management information reporting and audits.

(6) Using Technical Expertise. Personnel with adequate technical background and knowledge of programmatic objectives should be used to help management set technical goals and parameters for efficient planning and implementation of energy conservation programs. These technicians should work in conjunction with the line managers who are accountable for both mission accomplishment and energy conservation.

(7) Employee Awareness. Employees must gain an awareness of energy conservation through formal training and employee information programs. They should be invited to participate in the process of developing an energy conservation program, and to submit definitive suggestions for conservation of energy.

(8) Energy Emergency Planning. Every energy management plan must provide for programs to respond to contingencies that may occur at the local, state or National level. Programs must be developed for potential energy emergency situations calling for reductions of 10 percent, 15 percent and 20 percent for up to 12 months. Emergency plans must be tested to ascertain their effectiveness.

(9) Budgetary and Fiscal Support. Resources necessary for the energy conservation program must be planned and provided for, and the fiscal systems adjusted to support energy management investments and information reporting.

(10) Environmental Considerations. Each agency shall fulfill its obligations under the National Environmental Policy Act in developing its plan.



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