article: SECTION 1. SHORT TITLE. This Act may be cited as the ``Energy Savings Performance Contracts Amendments Act of 2003''. SEC. 2. PERMANENT EXTENSION. Section 801(c) of the National Energy Conservation Policy Act (42 U.S.C. 8287(c)) is repealed. SEC. 3. COST SAVINGS FROM REPLACEMENT FACILITIES. Section 801(a) of the National Energy Conservation Policy Act (42 U.S.C. 8287(a)) is amended by adding at the end the following new paragraph: ``(3)(A) In the case of an energy savings contract or energy savings performance contract providing for energy savings through the construction and operation of one or more buildings or facilities to replace one or more existing buildings or facilities, benefits ancillary to the purpose of such contract under paragraph (1) may include savings resulting from reduced costs of operation and maintenance at such replacement buildings or facilities when compared with costs of operation and maintenance at the buildings or facilities being replaced. ``(B) Notwithstanding paragraph (2)(B), aggregate annual payments by an agency under an energy savings contract or energy savings performance contract referred to in subparagraph (A) may take into account (through the procedures developed pursuant to this section) savings resulting from reduced costs of operation and maintenance as described in subparagraph (A).''. SEC. 4. ENERGY SAVINGS. Section 804(2) of the National Energy Conservation Policy Act (42 U.S.C. 8287c(2)) is amended to read as follows: ``(2) The term `energy savings' means-- ``(A) a reduction in the cost of energy or water, from a base cost established through a methodology set forth in the contract, used in an existing federally owned building or buildings or other federally owned facilities as a result of-- ``(i) the lease or purchase of operating equipment, improvements, altered operation and maintenance, or technical services; ``(ii) the increased efficient use of existing energy sources by cogeneration or heat recovery, excluding any cogeneration process for other than a federally owned building or buildings or other federally owned facilities; or ``(iii) the increased efficient use of existing water sources; or ``(B) in the case of a replacement building or facility described in section 801(a)(3), a reduction in the cost of energy, from a base cost established through a methodology set forth in the contract, that would otherwise be utilized in one or more existing federally owned buildings or other federally owned buildings by reason of the construction and operation of the replacement building or facility.''. SEC. 5. ENERGY SAVINGS CONTRACT. Section 804(3) of the National Energy Conservation Policy Act (42 U.S.C. 8287c(3)) is amended to read as follows: ``(3) The terms `energy savings contract' and `energy savings performance contract' mean a contract which provides for-- ``(A) the performance of services for the design, acquisition, installation, testing, operation, and, where appropriate, maintenance and repair, of an identified energy or water conservation measure or series of measures at one or more locations; or ``(B) energy savings through the construction and operation of one or more buildings or facilities to replace one or more existing buildings or facilities.''. SEC. 6. ENERGY OR WATER CONSERVATION MEASURE. Section 804(4) of the National Energy Conservation Policy Act (42 U.S.C. 8287c(4)) is amended to read as follows: ``(4) The term `energy or water conservation measure' means-- ``(A) an energy conservation measure, as defined in section 551(4) (42 U.S.C. 8259(4)); or ``(B) a water conservation measure that improves water efficiency, is life cycle cost effective, and involves water conservation, water recycling or reuse, improvements in operation or maintenance efficiencies, retrofit activities or other related activities, not at a Federal hydroelectric facility.''. SEC. 7. REVIEW. Within 180 days after the date of the enactment of this Act, the Secretary of Energy shall complete a review of the Energy Savings Performance Contract program to identify statutory, regulatory, and administration obstacles that prevent Federal agencies from fully utilizing the program. In addition, this review shall identify all areas for increasing program flexibility and effectiveness, including audit and measurement verification requirements, accounting for energy use in determining savings, contracting requirements, and energy efficiency services covered. The Secretary shall report these findings to the Committee on Energy and Commerce of the House of Representatives and the Committee on Energy and Natural Resources of the Senate, and shall implement identified administrative and regulatory changes to increase program flexibility and effectiveness to the extent that such changes are consistent with statutory authority. SEC. 8. PILOT PROGRAM TO EXPAND ENERGY SAVINGS PERFORMANCE CONTRACTS TO NON-BUILDING PROJECTS. Title VIII of the National Energy Conservation Policy Act (42 U.S.C. 8287-8287c) is amended by adding at the end the following: ``SEC. 805. PILOT PROGRAM FOR ENERGY SAVINGS PERFORMANCE CONTRACT INVESTMENTS IN NON-BUILDING ENERGY SAVINGS PROJECTS. ``(a) Authorization.--The Secretary of Defense and the heads of other interested Federal agencies are authorized, on a pilot basis, to enter into up to ten energy savings performance contracts under this Title for the purpose of achieving savings, secondary savings, and benefits incidental to those purposes, in non-building energy efficiency improvement projects. ``(b) Selection of Projects.--The Secretary of Energy, in consultation with the Secretary of Defense and the heads of other interested Federal agencies, shall select up to ten contract projects for this pilot program. The projects shall be selected to demonstrate the applicability and benefit of energy savings performance contracting to a range of non-building energy efficiency improvement projects. ``(c) Definitions.--For the purposes of this section: ``(1) The term `non-building' means any vehicle, device, or equipment that is transportable under its own power by land, sea, or air and consumes energy from any fuel source for the purpose of such transportability, or to maintain a controlled environment within such vehicle, device or equipment; or any Federally owned equipment used to generate electricity or transport water. ``(2) The term `secondary savings', means additional energy or cost savings that are a direct consequence of the energy savings that result from the energy efficiency improvements that were financed and implemented pursuant to the energy savings performance contract. Such `secondary savings' may include, but are not limited to, energy and cost savings that result from a reduction in the need for fuel delivery and logistical support. In the case of electric generation equipment, secondary savings may include the benefits of increased efficiency in the production of electricity. ``(d) Report.--No later than three years after the enactment of this section, the Secretary of Energy shall report to the Congress on the progress and results of this program. Such report shall include: a description of all projects undertaken; the energy and cost savings, secondary savings, other benefits and problems resulting from such projects; and the overall cost-benefit of such projects. The report shall also include recommendations, developed in consultation with those agencies that undertook projects under the program, as to whether the authorization to enter into energy savings performance contract for non-building projects should be extended, expanded, or otherwise modified.''. SEC. 9. UTILITY INCENTIVE PROGRAMS. Section 546(c)(3) of the National Energy Conservation Policy Act (42 U.S.C. 8256(c)(3)) is amended by striking ``facilities'' and inserting ``facilities, equipment and vehicles''.
summary: Energy Savings Performance Contracts Amendments Act of 2003 - Amends the National Energy Conservation Policy Act (NECPA) to: (1) repeal the termination dates governing the authority to enter into energy savings performance contracts (thus extending such authority indefinitely); (2) allow as an approved benefit ancillary to an energy savings contract or energy savings performance contract providing for energy savings through construction of replacement facilities those savings resulting from reduced operation and maintenance costs at such facilities; and (3) authorize the Secretary of Defense and the heads of other interested Federal agencies to enter into a pilot program for energy savings performance contract investments in non-building energy efficiency improvement projects.