Energy Efficiency in the United States – a historical overview

Government investment in energy efficiency and low carbon technologies has been surpassed by investments in wind, solar and biofuels, with only 9% of investment being directed towards this sector between 2005 and 2010. Only other renewables received less funding at 6% of total investment.


At the federal level, the economic downturn in 2008 and 2009 resulted in two major bills that stimulated growth in the energy sector: The Energy Improvement and Extension Act of 2008 (The Bailout Bill); and the American Recovery and Reinvestment Act of 2009 (The Stimulus Bill).
Major energy efficiency projects introduced through the American Recovery and Reinvestment Act (ARRA) include the State Energy Program (SEP) formula grants, Energy Efficiency and Conservation Block Grant (EECBG) funds administered directly by state energy offices and the State Energy Efficient Appliance Rebate Program (SEEARP).
An investment tax credit of 30% is provided for manufacturers of energy efficiency technologies that reduce greenhouse gas emissions or efficient transmission and other clean energy technologies, known as the “Advanced Energy Manufacturing Tax Credit”, through the ARRA. A total of USD 2.3 billion of tax credits is available for project through competitive bidding.
However, in anticipation of austerity measures in the US, funding for energy efficiency projects may reduce in the near-term.

Public sector

As part of the US Energy Policy Act of 2005, all federal facilities must install advanced energy metering by the end of 2012.


Commercial buildings that halve their annual energy and power consumption may be eligible for an Energy Efficient Commercial Building Tax Deduction up until 2013. This is capped at USD 1.80 per square foot.


Tax credits of up to USD 3,500 are available for fuel efficient vehicles and for high efficiency hybrid or diesel light duty vehicles. Each weight and fuel economy class has a cap.

Energy efficient products

Tax credits are available for energy efficient and renewable energy products until the end of 2011 or 2016. Furthermore, Business Tax Credits are higher for the manufacture of energy efficient appliances. There seems to be a general preference towards renewable energy products over energy efficiency. Currently plans to phase out incandescent bulbs are being contested by bills that are concerned over the use of mercury in LEDs.