The murky insider’s world of Washington energy efficiency politics

June 29, 2011
This is a story about the strange, interconnected world inside Washington. On June 24, a coalition of 22 trade associations sent a letter to the Department of Energy, wondering why it seems like they are getting frozen out of residential energy ...

This is a story about the strange, interconnected world inside Washington.

On June 24, a coalition of 22 trade associations sent a letter to the Department of Energy, wondering why it seems like they are getting frozen out of residential energy auditing and retrofit work. The issue at hand is the voluminous Workforce Guidelines for Home Energy Upgrades. These are some big guidelines. The Adobe Acrobat file is 632 pages long. It’s filled with all sorts of stuff about HVAC and plumbing. The problem, according to the 22 organizations signatory to the June 24 letter, is that nobody asked the plumbing and HVACR industries about this stuff.

“We are alarmed at the limited and opaque process by which the Workforce Guidelines for Home Energy Upgrades and the selection process for the Workforce Guidelines Certifying Body are being carried out,” the coalition says in the letter to Dr. Henry Kelly, acting assistant secretary, Office of Energy Efficiency and Renewable Energy.

At the risk of getting off track, it’s worthwhile to pause here to list the organizations involved, because they constitute everybody who’s important in the field. They are:

• Air Conditioning and Refrigeration Safety Coalition

• Air Conditioning Contractors of America

• Air-Conditioning, Heating, and Refrigeration Institute

• Carbon Monoxide Safety Association

• Educational Standards Corporation Institute

• ESCO Press International

• Heating, Airconditioning & Refrigeration Distributors International

• HVAC Excellence

• Indoor Air Quality Association

• International Association of Plumbing & Mechanical Officials

• International Code Council

• National Association of Home Builders

• National Association of the Remodeling Industry

• National Lumber and Building Material Dealers Association

• North American Technician Excellence

• Plumbing-Heating-Cooling Contractors – National Association

• Refrigeration Service Engineers Society

• Residential Energy Services Network

• The ESCO Group

• The Green Mechanical Council

• Window and Door Manufacturers Association

For cryin’ out loud, even the homebuilders are on our side on this one, which is a bit ironic for reasons I’ll get to later.

The 22 were put together through the efforts of Charlie McCrudden, vice president, government relations, for ACCA. “We’re all in the industry,” McCrudden told CONTRACTOR, “and we were talking amongst ourselves and decided that some of these activities created enough of a concern that we talked about what our concerns were and we realized we didn’t have the answers and the answers are to be found at DOE.”

What the associations are worried about is that it seems like the Building Performance Institute, Malta, N.Y., has an inside track to do all of the contractor certification for home energy auditing and energy retrofits. Does the name Building Performance Institute sound familiar? It should. The 22 organizations asked DOE what’s going on with what should be an open process for selecting independent certifying bodies. So far it seems like there’s only one — BPI. Not only that, it seems like the Feds are helping BPI write the standards.

The coalition letter continues, “On May 18, several of the undersigned groups wrote to you as part of a coalition with comments and questions about the development and drafting process for the Workforce Guidelines for Home Energy Upgrades and the selection of independent, third-party organizations to oversee worker certification under these guidelines. To date we have not received a response,” the coalition letter states.

“That letter referenced a May 3 notice stating, ‘The Department of Energy (DOE) Office of Energy Efficiency and Renewable Energy (EERE) will open a second round of public comments on the standard work specifications component of the Workforce Guidelines beginning in early June, 2011.’ However, early June has passed and none of the undersigned organizations have received any clear information about this second public review or an updated version of the Workforce Guidelines. When can we expect the release of the Workforce Guidelines standard work specifications for a second public review? Knowing that more than 950 comments were submitted on the standard work specifications, we are anxious to see how those comments were incorporated into the next version.”

So what’s with the delay, the group wants to know. Is this simply a federal agency running behind schedule or is DOE going to fast-track this program? What happened to the 950 comments?

The coalition asks when the National Renewable Energy Laboratory is going to open up the procurement process for certifying bodies. Oops, too late.

“At the Workforce Guidelines Certification Scheme Committee Meeting last month we heard some disturbing news about the selection process,” the letter states. “It was publicly stated by DOE and NREL officials that the process had already concluded and that NREL was in the final stages of negotiating a contract with a single, unnamed entity.”

That single, unnamed entity, whose name rhymes with BPI, is being helped by the Pacific Northwest National Lab, which is hosting an automated online standards notice and comment tool for two standards under review by BPI at: http :// .php. BPI is certified by ANSI as a standards writing body, but it has never issued a standard.

So why does the name BPI ring a bell? It turns out it was written into the federal Home Star legislation that we wrote about last summer and in a predecessor bill before that.

Plumbing and HVAC contractors were upset about the Home Star legislation because it required any contractor doing work that qualified for all the federal money being proposed to be certified by BPI. At the time, most BPI certified contractors were in two states, New York and New Jersey.

Last summer, ACCA President and CEO Paul T. Stalknecht said, “The association cannot support the accreditation portion of the Gold Star section of the legislation. Gold Star would offer rebates of up to $8,000 per house, but require contractors to be accredited by the Building Performance Institute (BPI), a national standards development and contractor credentialing organization for residential energy efficiency retrofit work. Ninety-two percent of BPI's accreditations are currently issued in only two states, New York and New Jersey.

"The legislation did include an amendment that would require the Department of Energy to approve or deny proposed alternatives to BPI within 30 days," Stalknecht said, "but we do not find this to be an acceptable alternative.”

In a letter to the editor published in CONTRACTOR in September 2010, Tom Meyer, director of government & professional relations for the ESCO Group, noted, “At this point, it is fair to say that to qualify for Gold Star a contractor must be a BPI Accredited Contractor with a BPI certified workforce. What does that mean to a contractor?

“Under the bill, an accredited company must demonstrate continued compliance to the BPI requirements to maintain its accredited status, and accredited companies must remain in compliance with BPI's Quality Assurance Program requirements in order to qualify for renewal consideration.

“To apply for or to renew BPI accreditation all contractors must pay an annual fee consisting of an accreditation fee and the quality assurance fee. The quality assurance fee is determined by the company's gross income from BPI-standards related work. The table of fees goes from $1,000 to $7,000 and up. To renew accreditation, a contractor must pay BPI $1,500 to $7,500 and up.”

The Home Star legislation died in the Senate. As Meyer told us at the time, Home Star would require another $5 billion and Congress was not going to appropriate $5 billion in the current political climate.

So how did BPI get itself written into the Home Star legislation? Larry Zarker, the CEO of BPI, said he doesn’t know.

“We really have been sticking to our knitting,” Zarker told me. “We work with states and utilities and work on developing standards. We are an ANSI standards developer. We bring programs to market that serve the market’s certification needs. We paid attention to programs being developed around the country and we made ourselves available.”

Zarker has been working with DOE since 1980 when he first worked in Washington. He has worked with HUD and the EPA over the years and he was with the NAHB Research Center for 20 years doing marketing for research programs on behalf of homebuilders and remodelers. That’s why I was mildly amused that NAHB is one of the signatories to the coalition letter complaining about an organization whose leader spent half his career at NAHB. It’s a small world.

Certainly Zarker has a vested interest in making sure that there’s a steady demand for his organization’s graduates. Zarker told Crain’s Cleveland Business on June 14, 2010, that, “… he's worried that consumer demand for audits might not be keeping pace with the number of people entering the field. For instance, the organization [BPI] in 2009 certified 4,647 home energy auditors and other experts in home energy use, up from 1,353 in 2008. The Home Star legislation could boost demand, though, he added.

“Regardless, energy efficiency projects are good for the country, Mr. Zarker said: They create jobs, help people save money and reduce pollution.

“ ‘Secretary (Steven) Chu at the Department of Energy said this isn't low-hanging fruit; this is fruit lying on the ground,’ said Mr. Zarker, playing off the energy administrator's quote,” Crain’s Cleveland Business reported.

What I’m wondering is how a nice guy who is as straightforward and forthcoming as Larry Zarker can set off my BS detector. He told me that he did not have anything to do with BPI being written into the Home Star legislation and that BPI does not have a lobbyist. I don’t believe that things like that happen by accident. I’m not saying anything untoward is going on, but BPI is deeply, deeply entrenched with the energy conservation community.

If you look at BPI staff and board of directors, it includes people with backgrounds with the New York State Energy Research and Development Authority (NYSERDA), the U.S. Green Building Council, the Energy Star program and the Laborers International Union of North America.

The Laborers? Let’s go back to something that Tom Meyer mentioned in his letter to the editor.

A certified workforce under Home Star meant, “certified through an existing certification that covers the appropriate job skills under:

(A) an applicable third-party skill standard established

(i) by BPI;

(ii) by North American Technician Excellence;

(iii) by the Laborers International Union of North America.

NATE is one of the signatories to the coalition letter. In fact, Peter Schwartz, president and CEO of NATE and the former top exec at the plumbing wholesalers’ American Supply Association, is steaming.

“I have not seen many other examples during my professional career of a federal agency developing standards and guidelines of far reaching impact in such secrecy and restriction,” Schwartz said.

The Laborers, however, are still very much in the mix. The union jumped on the green weatherization bandwagon early on.

Last October, at an event in Cincinnati, LIUNA boasted that U.S. Energy Secretary Steven Chu acknowledged the role LIUNA “is playing in creating family-supporting weatherization jobs in Cincinnati and praised the union’s breakthrough national weatherization training program.

“At a residential energy efficiency roundtable at Cincinnati State University, Secretary Chu touted current weatherization workforce development efforts in the Cincinnati region,” LIUNA said in a press release. “At a time when some stimulus programs are coming under fire, he noted that Cincinnati provides a national example of how strong local partners can come together to place workers into training programs that lead to quality work opportunities.

“Earlier this year, the Greater Cincinnati Energy Alliance (GCEA) was awarded a $17 million ‘Retrofit Ramp Up’ grant by the U.S. Department of Energy to weatherize a large percentage of homes in the region and create good paying jobs for local residents. In conjunction with the ‘Ramp Up’ award, LIUNA has been partnering with the GCEA and others to implement the grant program effectively.”

LIUNA is also very well connected politically both with DOE and with the Department of Labor. According to an NPR report, Union Power — More Than Meets the Eye, from Oct. 30, 2008, LIUNA planned to spend $15 million on the election, more than twice as much as it spent in 2004. The lion’s share went to Democrats.

LIUNA also seems to be the only labor organization involved in the development of the Workforce Guidelines. In the acknowledgements section of the Workforce Guidelines, DOE thanks all the people and organizations that contributed, including “labor organizations.” Which ones? My inquiries so far have not unearthed any involvement from the United Association, the Sheet Metal Workers or the IBEW. I’ll update this if I hear otherwise.

All of the relevant players make the rounds to the same events. If you look at the speaker roster for events such as the Residential Energy Services Network 2011 RESNET Building Performance Conference and the Affordable Comfort Inc. ACI Home Energy Summit, it includes Zarker, Benjamin Goldstein, the DOE project lead on the home performance workforce guidelines, a representative of LIUNA, and somebody from the national labs like Pacific Northwest National Labs.

To say the least, it’s all very cozy. It would not be out of the question that Zarker is hanging out in the speakers’ lounge with the guy running the workforce guidelines program for DOE, along with people from NYSERDA, LIUNA, the national labs and USGBC.

In going through the workforce guidelines, I can’t quibble about their intent. Weatherization and energy efficiency are good things. Combustion analysis is a good thing. So are heat load calculations and duct sealing.

Now I’ve been writing about HVAC and plumbing for more than 30 years. I got my first job on Contracting Business when it was still called Air Conditioning & Refrigeration Business. Call me old fashioned, but I don’t want a laborer working on boilers, furnaces or water heaters. As ACCA’s McCrudden says, you have an appliance in your basement that’s on fire. The part that’s not on fire is electrified.

The whole arrangement doesn’t smell right. The coalition letter to DOE asks that the process be done over.

“We are concerned that the selection process for the certifying body as carried out by NREL failed to conform to competitive procurement rules,” the letter says. “It appears that NREL invited only pre-selected organizations based on some unknown criteria. We believe the process was not conducted in an open and transparent manner and that NREL should restart the process with invitations to all organizations with ANSI 17024 accreditation or Applicants for ANSI 17024 accreditation.”

That would mean specific invitations to everybody in the industry who has expertise. Mark Riso, director of government relations for PHCC-NA, points out that saying, “You’re always welcome,” is not the same thing as an explicit invitation.

“This process needs to be reviewed — and DOE needs to move forward henceforth in an open and equitable manner, so the influence of all related parties is taken into account,” says NATE’s Peter Schwartz. “ … In addition to creating a potentially adverse climate within our industry in particular, this process sets a seriously flawed precedent for both DOE and other federal agencies to follow in the future.”

I agree 100%. It’s unconscionable that the organizations that have the expertise in plumbing and HVAC have not been asked to participate. But am I surprised? Sadly, no.

About the Author

Robert Mader Blog | Editor in Chief

Bob Mader is the editor of CONTRACTOR magazine, Green Mechanical Contractor magazine, and Radiant Living magazine. He has been writing about plumbing, mechanical, green building and HVACR topics for more than 25 years.

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