CE Makers Oppose Energy Star ‘User Fees’ Proposed in EPA Budget

The CE industry said it was blindsided by an EPA proposal in the Obama administration’s 2012 budget to charge “user fees” for manufacturers seeking to use the Energy Star label. “The consumer electronics industry is a major stakeholder in the Energy Star program, and EPA did not reach out to us regarding its plans to impose user fees on Energy Star program participants,” said Douglas Johnson, CEA vice president-technology policy.

The one-paragraph proposal was tucked away in a 1,625-page “Justification for Appropriations Estimates” report to the House Appropriations Committee. The EPA provided no justification for the fee except to say that “Energy Star products have qualified for special rebates, tax exemptions or credits, and procurement preferences.” The agency is proposing to start collecting fees in 2013 after a rulemaking to “determine products to be covered by fees and the level of fees and to ensure that a fee system would not discourage manufacturers from participating in the program or result in a loss of environmental benefits."

The EPA, in a statement to our affiliated newsletter Green Electronics Daily, said because the use of the Energy Star label “can be considered a special benefit of a government service,” the agency is looking at “opportunities to institute user fees where appropriate.” The user fee proposal follows the agency’s recent “unilateral decision to mandate a costly third-party certification scheme for Energy Star,” CEA’s Johnson said: “We expect to meet with EPA shortly to get more details on their proposal to pursue user fees, including the justification that they feel they have to do this independent of Congress."

The CE industry already is burdened with a “huge new expense with the third-party certification requirements,” said one TV maker executive. “We don’t see that a user fee is necessary and it makes it a more expensive proposition for manufacturer to participate.” He said it was “hard to say” to what extent the move will affect CE industry participation in the program, but “I think it will definitely force people to reexamine their level of participation.” The executive said he did not believe the user fee proposal was prompted by budget cuts because the agency hasn’t “made the case” for imposing the fee.

The new Energy Star verification and testing requirements have added “significantly to the costs of the program” for appliance makers, said Jill Notini, vice president of the Association of Home Appliance Manufacturers. “The thought of a user fee on top of costs already shouldered by the Energy Star partners, such as marketing, advertising and now ongoing verification and testing, would be an excessive burden to appliance manufacturers."

Advocacy groups we contacted voiced ignorance of the user fee proposal. If Energy Star’s viability is affected by budget cuts, then the agency would be justified in charging manufacturers a fee to sustain the program, said an appliance program manager for one such group that pushes for regulations in the states and is a participant in the Energy Star specification development process. “The program offers a lot of benefits to manufacturers,” he said, and manufacturers would “likely be the next source of funding” if Energy Star is deprived of adequate government support.

The Obama administration proposed a fiscal 2012 budget of $8.97 billion for the EPA, a 13 percent reduction from two years earlier. But the Energy Star program is recommended for a $3 million increase from 2010 funding to $55.6 million.