Good morning Mr. Chairman and members of the Task Force. My name is Joshua Lief, Deputy Secretary of Commerce and Trade. Thank you for the opportunity to speak before you today.
I will be presenting information on behalf of the Gilmore administration about the current efforts of state government in the areas of energy assistance programs for low-income households, energy efficiency, and alternative energy programs. We also have representatives from the departments of Social Services, Housing and Community Development, and Mines, Minerals and Energy here today to help with questions you may have.
In the area of low-income benefit programs, Virginia has operated
the Low Income Home Energy Assistance Program, which is known
as LIHEAP, for about the past 25 years. The program is managed
by the Department of Social Services. It is primarily funded
with federal LIHEAP funds. LIHEAP provides support to households
with incomes up to 130% of the federal poverty guidelines in three
components:
The LIHEAP program has been funded at between $20 and $26 million over the last five years. It has served an average of 99,000 households for fuel assistance, and 3,300 households for crisis assistance each of these years. Total available funding is based on the amount of federal LIHEAP funds provided each year, and whatever supplements are added. For example, this past year, the LIHEAP funds were supplemented with $5 million of excess Temporary Assistance to Needy Families (TANF) funds.
Virginia has operated the Weatherization Assistance Program for the last 25 years. Nearly 100,000 of the approximately 500,000 eligible households have received weatherization assistance since its inception. Since 1991, the Department of Housing and Community Development has managed this program through local weatherization contractors. The weatherization program provides for physical improvements to a home's energy using equipment, adding insulation, stopping air leaks, and other efforts to reduce the household's energy bills. Without the program, most of these households would lack access to the capital needed to make the energy efficiency improvements. The Department of Housing and Community Development uses the same eligibility criteria for weatherization as are used for LIHEAP.
Funding for the Weatherization Assistance Program has fluctuated between $4.9 and $6.6 million during the past five years. Sources of funding have changed from year to year, including federal Weatherization Assistance Program funds, a set-aside of 15% of LIHEAP funds, state general funds, oil overcharge funds, and special needs funds.
Legislation before the U.S. House of Representatives would require the state to match federal Weatherization Assistance Program grant funds by at least 25%. This would have required $584,000 if it were in effect during FY 1999. About $161,000 in state general funds were budgeted in FY 1999. If this federal legislation passes, we will need to budget additional non-federal funds for the Weatherization Assistance Program.
The Commonwealth also has funded weatherization activities through the Virginia Housing Development Authority. Grants were used to fund energy efficiency improvements as an add-on to housing rehabilitation loan programs. Approximately $35 million in oil overcharge funds were used between 1988 and 1997 for these grants.
Energy efficiency and renewable energy programs are provided through a variety of state agencies and institutions. The work is coordinated through the Virginia Energy Plan that sets out a series of goals, objectives, and strategies to advance energy efficiency in state government operations and services.
The Department of Mines, Minerals and Energy, using approximately $1.5 million in federal State Energy Program grant funds and oil overcharge funds per year, works with state agencies and institutions, public and private primary and secondary schools, and other customers to develop energy efficiency projects. The Department provides technical assistance and grant funds to develop and implement projects such as lighting upgrades, central boiler and chiller plant improvements, control system upgrades, and other energy efficiency projects. The Commonwealth also budgeted approximately $11 million in oil overcharge funds for these capital improvement projects, and the Treasury Board has approved over $3 million in master lease funds for energy-efficiency projects where the projects are paid for out of their savings. General funds have also been budgeted each year for energy efficiency projects in agencies' capital budgets.
DMME partners with many other organizations to provide energy conservation services. The agency is working with Virginia Tech's Center for Coal and Energy Research to create a web site showing Virginia specific energy production and consumption data (www.energy.vt.edu/vept). DMME recently received a federal grant to work with the Center for Coal and Energy Research on a project to help Virginia's mining industry develop more efficient operations. The agency also is working with Tech's Energy Management Institute to provide energy management services to Virginia's industries. DMME works with the Virginia Tech cooperative extension to provide some energy conservation information to the general public. This information service supplements the general energy conservation information available to small consumers through a federal Department of Energy consumer hotline and web site (www.eren.doe.gov).
Virginia supports solar photovoltaic panel manufacturers through a performance grant. Companies are eligible for up to 75 cents for each watt of capacity they manufacture in Virginia and sell. The Commonwealth has budgeted approximately $800,000 for this incentive to date. The incentive has resulted in over $35 million in investment and 125 jobs in James City and Northampton counties. DMME has received a $2.3 million federal grant to help one of the manufacturers commercialize their Virginia product. DMME also has supported the PV4VA collaborative that works to develop a strong business climate in Virginia for these companies.
A number of state universities provide energy efficiency assistance to residential, commercial, and industrial customers. I have mentioned some of Virginia Tech's efforts already. Other examples include the Industrial Assessment Center at ODU that provides energy analysis services to small manufacturers and energy efficiency activities at the Integrated School of Science and Technology at JMU.
The electric restructuring law you worked so hard on and passed last year includes a provision for net metering to start in July 2000. This will serve to support Virginia's solar photovoltaic and hydropower industries. I believe Mr. Chambliss of the State Corporation Commission mentioned this activity.
I hope this gives you a picture of the broad scope of efforts underway in state government in support of low-income energy programs, energy efficiency, and renewable energy. I have had to be brief to cover this range of activities, so as I mentioned we have representatives here today from the three main agencies offering these services to answer any questions you may have. Thank you again for the opportunity to share this information with you.