PART I: WHY THE GOVERNMENT CAN HELP RENEWABLES

Governments serve as useful customers for renewable energy for two reasons: size and diverse needs.

SIZE OF DEMAND

Governments as a whole represent the largest consumer of energy and electricity in the United States. In 1995, the federal government alone consumed 1,127 trillion British thermal units (Btu) of energy, or 1.24% of total national energy use. Within that total, it consumed approximately 54 billion kilowatt-hours (kWh) of electricity — more than 1% of the total used.⁴ The federal government’s total energy bill was $8 billion, or 2% of the federal consumption of goods and services. Its electricity bill was approximately $3.5 billion. Perhaps more important, in 1995 the federal government used more than twice as much electricity as was gener-ated by all the solar, wind, and geothermal facilities owned by utilities and the industrial sector nationwide.⁵ Thus, federal energy dollars could have a great impact on renewable energy markets.

Unfortunately, similarly comprehensive energy consumption data are not available for local and state government. But several indicators show that they are perhaps larger consumers of energy. Local governments owned or rented 7.5 billion square feet (bsf) of building space in 1996, compared to 2.8 bsf for state governments and 2.93 bsf by the federal government.⁶ In 1996, state and local government spent $657 billion on the consumption of goods and services, compared with $403 billion by the federal government. Similarly, state and local governments’ gross investment in structures and equipment, which amounted to some $146 billion in 1996, exceeds similar investments by the federal government, which came to nearly $63 billion.⁷ And states may use energy more intensively than the federal government. The state of Maryland’s facilities used 1.47 billion kWh of electricity at a rate of 293 kWh per resident in fiscal year 1998 — a more intensive use per resident than at the federal level.⁸ With more facilities and potentially more intensive energy use, state and local governments’ combined energy use should exceed federal energy use.

DIVERSITY OF DEMAND

Federal, state, and municipal governments own and manage a wide range of facilities that have energy needs that differ according to fuel, time of use, reliability requirements, and consumption intensity. The government is perhaps most identified with buildings. But buildings have different uses. Certainly, office buildings are important. But among building rentals by the federal government they are a minority — 46 percent of the total in 1997.⁹ The remainder consist of post offices, storage, housing, schools, research and development, and other facilities. Government buildings include the National Park Service’s and analogous state agencies’ remote ranger stations. Federal, state, and municipal governments oversee public housing authorities who manage civilian housing in all 50 states. And federal government laboratories need a reliable energy supply for both commercial and industrial applications.

Energy use is not restricted to buildings. Municipal governments and state transportation agencies need small, freestanding generators of electricity for highway lighting, call boxes, and emergency services. The armed services operate remote monitoring sites such as buoys, along with housing for their personnel and their families. And many governments own and maintain extensive fleets of vehicles.

In the federal government, the Department of Defense (DoD) towers above all other agencies in energy use (though much of this may be jet fuel, which has no renewables-based substitute).¹⁰ Other agencies such as the U.S. Department of Energy (with its laboratories and testing facilities), the U.S. Postal Service (with its post offices and vehicle fleets), Veterans Affairs (with its many hospitals), and Transportation (with the Coast Guard) are also significant (see Table 1).

The diversity of government facilities is not restricted to needs; it also includes locale. Government facilities stretch across the nation, and are found in regions that have abundant solar insolation, wind potential, geothermal reserves, and biomass resources. They are also located in regions with load profiles in which certain renewables can fit economically.¹¹

Diversity is an important factor in the government’s ability to help commercialize renewables. The government is a consumer whose needs reflect the diversity of the private market — and one that can offer demand that could support the efforts of renewable energy firms to enter numerous customer markets simultaneously.

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