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In today’s difficult legislative climate, many important issues have fallen by the wayside on Capitol Hill because of partisan gridlock, frustrating those whose job it is to advocate for issues and industries inside the Beltway. The Air-Conditioning, Heating, and Refrigeration Institute (AHRI), however, had the distinction of successfully shepherding a major legislative priority through this past Congress—a distinction very few organizations can claim. In the waning hours of the 112th Congress, a bill (H.R. 6582) that contained important technical corrections to commercial refrigeration efficiency standards, codified new standards for small duct high velocity air conditioners, and expedited a uniform efficiency descriptor and accompanying test procedure for water heaters passed the House and Senate and was ultimately signed by the President. Not that we’re bragging or anything.
AHRI members and staff have spent considerable time on Capitol Hill over the past several years educating members of Congress about the more than 125,000 American employees who manufacture heating, ventilation, air conditioning, commercial refrigeration (HVACR), and water heating technologies. We have reminded them that our members’ employees contribute nearly $5 billion to the economy through personal income, while keeping citizens comfortable and productive.
It is a well-established fact that sufficient heating in winter saves lives, but did you know that air conditioning in the summer—which some in recent years have derided as a bourgeois luxury—also saves lives? It’s true: A recent study by the Massachusetts Institute of Technology, publicized by the Washington Post, found that as central air conditioning has increased, heat-related deaths have decreased—by more than 80 percent since 1960. In short, AHRI has made it our priority to represent our members’ interests in Congress, highlighting their positive contributions to the American economy and society, and we have been successful despite the difficulties posed by the current political climate.
But it’s not just Congress on our agenda. The Department of Energy (DOE) and Environmental Protection Agency (EPA) rely on AHRI to act as a verified third-party certification body, and because of the expertise of AHRI staff and members on complex industry-related topics, we play a pivotal role in the development of federal policies and regulations affecting HVACR and water heating products. AHRI’s certification label serves as a globally recognized, industry respected sign that products will perform as specified, and obviates the need for complex, burdensome, and duplicative government programs.
AHRI has urged DOE—thus far with limited success—to rely upon our existing, decades-old certification programs rather than developing unnecessary new ones. However, AHRI will continue to partner with regulatory bodies to educate them about the benefits and successes of third-party certification programs, such as our own. At the same time, we will work with our friends on Capitol Hill to at least limit, if not eliminate, these duplicative programs.
The development of highly energy efficient equipment remains one of AHRI members’ highest priorities, and serves as a representation of the value we place on environmental stewardship. We work closely with environmental advocates and federal agency staff to effectively and sensibly craft pragmatic energy efficiency policies that achieve demonstrable energy savings while preventing unnecessary burden on industry and potential reductions in employment. We strive to expand consumer choice, reduce energy consumption, and protect our industry’s economic contributions by championing common sense legislation such as the bill we had passed last year.
A key initiative in our push for common sense approaches to energy efficiency and environmental stewardship is addressing the depreciation schedule for commercial HVACR and water heating equipment. The current 39-year depreciation schedule bears no relation to any realistic equipment life expectancy, and severely inhibits the ability of building owners to upgrade to more efficient, environmentally-friendly technologies. This short-sighted federal approach might save a few tax dollars in the short run, but it wastes energy and costs the general economy money over the long run. AHRI is working with Congress to change the depreciation schedule to a more realistic 20-to 25-years to enable change out of the current commercial installed base.
Another way to increase the installation and use of energy efficient HVACR and water heating technologies is the use and improvements of existing tax credits, such as Section 179D, the Energy Efficient Commercial Building Tax Deduction. These incentives could be better utilized by fixing the existing deduction for new buildings, focusing on multiple paths for qualification with retrofits, and allowing the credit to be shared among pertinent building improvement stakeholders. These changes, along with a reduced depreciation schedule, would encourage the replacement of older and less efficient equipment, resulting in greater job creation and higher property values for our nation’s commercial buildings.
AHRI will continue to work with our association partners and our friends on Capitol Hill to foster bipartisan support for these and other practical solutions to everyday issues.