Memorandum of
Disapproval of the Appliance Energy Conservation Bill
I
am withholding my approval of H.R. 5465, the ``National Appliance Energy
Conservation Act of 1986.''
This
legislation would have established specific, minimum energy efficiency
standards for home appliances without regard to technological feasibility or
the need for economic justification. The bill intrudes unduly on the free
market, limits the freedom of choice available to consumers who would be denied
the opportunity to purchase lower-cost appliances, and constitutes a
substantial intrusion into traditional State responsibilities and prerogatives.
It also mandates a complicated series of 19 rule-makings over the next 20 years
for 52 subcategories of appliances, virtually assuring extensive litigation,
increasing Federal regulation many years into the future.
Moreover,
although I share the interest in the need for conserving energy resources that
led the Congress to pass this bill, H.R. 5465 fails to advance this goal in a
manner that takes account of the tremendous cost to consumers, who would have
to spend an estimated extra $1.4 billion per year on appliance purchases.
Higher prices would force many to buy more expensive appliances than they would
prefer, and make some delay or forgo some appliance purchases altogether. By
eliminating the lower-priced models, the bill would hit low-income consumers
particularly hard. It could also discourage and slow the introduction of useful
product innovations.
Disapproval
of this bill does not mean, however, that the energy efficiency of appliances
will be wholly without Federal regulation. Under current law, the Department of
Energy is required to conduct a rule-making which may lead to the imposition of
Federal standards, and any such standards would preempt existing State law.
Thus,
the choice is between Federal regulation of appliance standards under this bill
and regulation under current law, which requires the Department of Energy to
take account of technological feasibility and economic factors. Under these
circumstances, I think current law is preferable.
In
addition, I note that the Congress included in H.R. 5465 amendments requiring
the Federal Energy Regulatory Commission to issue a declaratory order in a
pending proceeding and setting a deadline for the Commission to resolve a
pending rate case. I am in agreement with what the Congress sought to achieve
in requiring the Commission to issue a declaratory order and am asking the
Secretary of Energy to take appropriate action before the Federal Energy
Regulatory Commission so that this matter will be promptly and favorably
resolved. I also agree with the Congress that the rate case matter should be
resolved swiftly and urge the Commission to exert its best efforts to meet the
deadline the Congress has sought to impose.
Ronald
Reagan
The
White House,