	Significant Opportunities Exist for Incorporating Energy Efficiency Measures into Gulf Coast Reconstruction Efforts, Which Could Reduce Energy Expenditures

The anticipated rebuilding and repairing of residential and commercial  structures in the Gulf Coast creates an important opportunity for  incorporating energy efficiency improvements that could produce long- term energy cost savings. We estimated that newer building codes and  standards could significantly reduce energy expenditures for residential  and commercial buildings in Louisiana and Mississippi, depending on the  rebuilding efforts in these states. The Scope and Status of the Reconstruction Efforts Create Significant Opportunities to Reduce Energy Expenditures through New Building Codes and Standards

The sheer magnitude of the reconstruction effort creates a tremendous  opportunity for incorporating energy efficiency improvements into rebuilt  homes and buildings. This rebuilding creates an opportunity for these states  to make wide-scale improvements to their building stock, especially the  older vintage housing in the areas. Since these  planning efforts are evolving, now is an opportune time to consider fully  incorporating energy efficiency improvements in the reconstruction  efforts. Furthermore, Louisiana’s and Mississippi’s recent adoption of  newer and more energy efficient building codes creates a unique  opportunity for rebuilding all of the destroyed and severely damaged  homes in a manner that could result in significant energy cost savings for  these two states. Second, states will face  serious challenges ensuring compliance with newer building codes,  thereby potentially limiting energy cost savings opportunities from being  realized. Availability of a Skilled Construction Workforce Trained to Meet Newer Building Codes and Standards May Limit Energy Cost Savings

The shortage of a skilled construction workforce capable of sustaining the  rebuilding and repairing of destroyed and damaged homes in Louisiana  and Mississippi may limit the energy cost savings that can be achieved by  rebuilding to the newly adopted building codes. Energy Efficiency May Be a Low Priority When Consumers Consider Rebuilding or Repairing Destroyed and Damaged Homes

According to state officials, home builders, and non-profit organizations in  Louisiana and Mississippi, consumers who desire to return to their homes  face difficult financial questions regarding compensation payments, the  higher costs of construction and insurance, and the availability of  employment, which may make decisions about energy efficiency a low  priority. HUD and DOE Are Providing Funding and Educational Resources to Encourage Gulf Coast States to Incorporate Energy Efficiency in Rebuilding

Because the rebuilding of the Gulf Coast is largely a state and local matter,  HUD and DOE have played a supportive role in promoting energy efficient  rebuilding. More specifically, HUD and DOE have provided financial and  educational resources that can encourage the incorporation of energy  efficiency in the reconstruction of the Gulf Coast. In addition both  agencies have broader national programs that may assist Louisiana and  Mississippi in incorporating energy efficiency improvements during their  rebuilding. HUD also has actions that were planned or under way prior to the Gulf  Coast hurricanes that are designed to improve the energy efficiency of the  nation’s public housing stock and that could potentially benefit the Gulf  Coast states. DOE Is Providing Energy Efficiency Training and Education to Consumers and State and Local Officials

In its capacity as the nation’s lead agency on energy efficiency issues,  DOE’s primary role in the Gulf Coast reconstruction has been to support  states by provide training and education to state and local officials, private  industry, and consumers. DOE has taken other actions to encourage parties involved in the  rebuilding process to consider energy efficiency. State Energy Program (SEP): DOE’s SEP provides grants to the states to  design and carry out their own renewable energy and energy efficiency  programs. DOE expertise as well as HUD and DOE  resources may prove invaluable to states and consumers as they make  decisions about building code training and enforcement, energy efficiency  construction practices, and purchasing energy efficient appliances and  equipment. HUD had no comments on the report. Appendix I: Objectives, Scope, and Methodology

During our review, our objectives were to (1) analyze the extent of  opportunities for incorporating energy efficiency improvements and  realizing energy cost savings in the Gulf Coast reconstruction, (2) discuss  potential challenges to realizing energy cost savings during the  reconstruction, and (3) describe the role of Department of Housing and  Urban Development (HUD) and the Department of Energy (DOE) in  promoting energy efficiency in the rebuilding of the Gulf Coast.
Why GAO Did This Study

Following several hurricanes in 2005, the need to rebuild and repair destroyed and damaged homes and buildings in the Gulf Coast region may create opportunities for making energy efficiency improvements and realizing energy cost savings. While numerous federal agencies are involved in the recovery process, the Department of Housing and Urban Development (HUD) and the Department of Energy (DOE) interact with the states on a regular basis regarding matters of energy efficiency. This report, initiated under the authority of the Comptroller General of the United States, examines (1) the extent of opportunities for incorporating energy efficiency improvements in the Gulf Coast reconstruction, (2) potential challenges to realizing the energy cost savings during the reconstruction, and (3) the role of HUD and DOE in promoting energy efficiency in the rebuilding of the Gulf Coast. GAO limited the scope of its work to Louisiana and Mississippi since these states experienced the majority of the hurricane damage. GAO assessed opportunities for incorporating energy efficiency measures by conducting site visits and interviewing federal, state government officials; home builders; and energy efficiency experts. GAO also worked with a DOE national laboratory to develop energy cost savings estimates. GAO is making no recommendations.

What GAO Found

Reconstruction in the Gulf Coast creates a significant opportunity for incorporating energy efficiency improvements that could produce long-term energy costs savings in residential and commercial buildings. The sheer magnitude of the reconstruction effort and Louisiana's and Mississippi's recent adoption of more energy-efficient building codes makes this an opportune time for incorporating energy efficiency improvements in the rebuilding efforts. In partnership with a DOE national laboratory, GAO analyzed energy cost savings opportunities and estimated that adopting these newer building codes could reduce residential energy costs in these two states by at least $20 to $28 million per year, depending on the extent of the rebuilding efforts in these states. Furthermore, the analysis also showed that annual energy expenditures for commercial buildings--hospitals, schools, offices, and retail buildings--built to newer energy standards could be about 7 to 34 percent lower than buildings built to older standards. There also are opportunities for consumers to make additional energy efficiency improvements to both building types by replacing old, damaged equipment. There are three substantial challenges to realizing the energy cost savings opportunities presented by the Gulf Coast reconstruction: (1) the shortage of a skilled construction workforce, and specifically, the shortage of workers trained to meet the newer building codes; (2) the lack of trained building code inspectors to ensure compliance with newer building codes in Louisiana and Mississippi; and (3) the difficult financial issues facing consumers, such as the sufficiency of insurance and other compensation payments, that may make decisions about energy efficiency a low priority. States have efforts under way to address many of these challenges and it will take time and sustained commitment for them to be successful. The rebuilding of the Gulf Coast is largely a state and local matter, but HUD and DOE have played a supportive role in promoting energy efficient rebuilding. HUD and DOE have provided financial and educational resources that can encourage energy efficient rebuilding, and both agencies have broader national programs that may support energy efficiency improvements in the rebuilding of the Gulf Coast. HUD has made $16.7 billion in funding available for general rebuilding purposes, such as restoring damaged housing, and allows states to determine how to spend these funds, including using them for energy efficient improvements. HUD also has several national initiatives that may directly improve the energy efficiency of the public housing stock in Gulf Coast states. DOE has sponsored education and training on energy efficiency issues to state and local officials, private industry, and consumers in Louisiana and Mississippi. As part of its nationwide effort to assist all states with energy efficiency initiatives, DOE provides grants to states to design and carry out their own energy efficiency programs. DOE's energy expertise as well as HUD and DOE resources may prove valuable to the states and consumers as they make decisions about energy efficient rebuilding in the Gulf Coast.