Energy Consumption: Federal Agencies' Electricity Use and Cost

Published by the Government Accountability Office on 1997-03-21.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

      United States
GAO   General Acconnting  Office
      Washington, D.C. 20548

      Resources, Commnnity,   and
      Economic Development    Division


      March 21, 1997

      The Honorable Thomas J. Bliley, Jr.
      Chairman, Committee on Commerce
      House of Representatives

      The Honorable Dan Schaefer
      Chairman, Subcommittee on Energy and Power
      Committee on Commerce
      House of Representatives

      Subject: Energv Consumution: Federal Agencies’ Electric&v Use and Cost

      Changes to the electricity industry are being considered at the federal and state
      levels that could affect federal agencies’costs for electricity. Currently,
      electricity constitutes about 45 percent of the energy used and about 80 percent
      of energy costs.’ To assist the Committee in its deliberations on changes in the
      electricity market, you asked us to provide information on (1) the amount of
      electricity used in federal buildings and facilities and (2) the costs of this
      electricity from fiscal year 1986 through fiscal year 1995. As agreed with your
      offices, we plan, in a subsequent review, to exarnine the estimated savings to
      the federal government If legislation were enacted authorizing the purchase of
      electricity competitively on the open market.

      %lectricity data are a subset of the energy data. Energy includes electricity
      and other fuels, such as natural gas, coal, and fuel oil.

                                                    GAO/fWED-97-97R Federal ElectriciQ   Use

    In summary, the federal government used about 61 billion kilowatt-hours’ of
    electricity in fiscal year 199~the latest year for which data were available-in
    its buildings and facilities. Electricity use in the federal government is highly
    concentrated in a few agencies: The Department of Defense (DOD) used about
    50 percent of the total in tical year 1995, and the five next largest consuming
    agencies-the Tennessee Valley Authority (TVA), the United States Postal
.   Service, the Department of Energy (DOE), the General Services Administration
    (GSA),3and the Department of Veterans Affairs-accounted for about another 34

    Electricity costs in federal buildings and facilities in fiscal year 1995 totaled
    about $3.5 billion. Electricity costs were similarly concentrated, with DOD and
    the five other agencies accountig for about 87 percent of the total cost.


    DOE’s Office of Federal Energy Management Programs (FEMP) coordinates
    federal energy efficiency efforts and reports annually to the Congress on federal
    energy consumption and conservation activities by executive branch agencies4
    FEMP gathers these data from agencies under three categories: buildings and

    2A watt is the basic unit used to measure electric power. A kilowatt is 1,000
    watts. A kilowatt-hour (kWh) is equal to 1 kilowatt of power applied for 1
    hour. The average household in the United States uses about 10,000 kWh of
    electricity per year, according to the Department of Energy’s Energy
    Information Administration.
    3GSA reports energy consumption data for buildings that it controls including
    data for buildings leased to tenant agencies to whom GSA has not delegated the
    responsibility for operation and maintenance.
    4For fiscal year 1995, FEMP’s data were for 28 executive branch agencies and
    did not include the judicial and legislative branch agencies. Enclosure I is a
    listing of the agencies that report data to FEMP.

    2                                              GAO/RCED-97-97R Federal Electricity   Use
facilities, energy-intensive operations,5 and vehicles and equipment6 In fiscal
year 1995, federal agencies used about 1.9 percent of the energy consumed in
the nation, according to FEMP.7 Because our primary focus for this report is
electricity use and costs, we combined the buildings and facilities and energy-
intensive operations categories for our discussion of federal buildings and

The few agencies that have facilities outside the United States differ as to how
they report to FEMP electricity consumption at such facilities. F’EMP officials
said that they do not attempt to isolate these data A DOD official told us
DOD’s total use reported to FEMP includes nondomestic use-about 24 percent
of DOD’s preliminary total use for &xl year 1996, costing about $420 million.
Electricity use at facilities outside the United States would not be affected by
restructuring the electricity industry in the United States.


Over the N-year period fiscal years 1986-95, the use of electricity measured at
federal buildings and facilities increased from 0.16 quadrillion British thermal
units (Bt@ in fiscal year 1986 to 0.21 quadrillion Btu in fiscal year 1995.
Fi,sure 1 shows electricity’s portion of energy use in quadrillions of Btu for the
28 agencies reportink to FEMP.

!?bis category includes the energy consumed in industrial operations, certain
research and development activities, and in electronic-intensive facilities, such
as air tmf6c control towers.

‘For &xl year 1995,28 agencies reported that buildings and facilities used
about 32 percent of the energy at a cost of about $3.6 billion, energy-intensive
facilities used about 9 percent at a cost of about $0.9 billion, and vehicles and
equipment used the remaining 59 percent at a cost of about $3.4 billion.
7Annual Renort to Congress on Federal Government Energv Management and
Conservation Programs. Fiscal Year 1995, DOE, Washington, DC.: Draft.
According to FEMP officials, the draft, which is expected to be published in
April 1997, contains tial consumption totals for fiscal year 1995, which we
*A Btu, the quantity of heat required to raise the temperature of 1 pound of
water 1 degree Fahrenheit, is a standard unit for measuring the energy used in
operating buildings and facilities.

3                                              GAOIRCED-97-97R Federal Electricity   Use
Fiaure 1: Electricitv’s Portion of Enerav Use in Federal Buildings and Facilities, in
British Thermal Units

Bbs in quadrillions




                                                                                           --   .m.-.-.m
0.2                          .-.-.=      .-.-.-.-.-.-*-.-.-.-.-.*--.

     ”1986         1987   7986        1989           1990        1991      1992     1993        1994       1995
                                                       Fiscal years
      s         Energy
      C.-.      ua$f*

Notes: The increases in fiscal years 1994 and 1995 are largely attributable to TVA.
They result from a revised management accounting method at TVA, designed to reflect
requirementsof the Energy Policy Act of 1992, which captures the costs of electricity
use in its plants (most of which is electricity used for the generation of electricity).
According to FEMP and TVA officials, comparable data are not available for previous
years. FEMP and TVA officials agree that this methodology provides additional
management information, but to be consistent with other agencies that produce
electricity, the fiscal year 1996 FEMP report will likely not reflect this energy use.

Energy includes electricity and other fuels, such as natural gas, coal, and fuel oil.

Source: Developed by GAO from data provided by FEMP.

J?@re 2 presents the same information on electricity use expressed in kilowatt-
hours rather than Btu.

 4                                                                      GAO/RCED-97-97R Federal Electricitp Use
Fiaure 2: Electricitv Use in Federal Buildinas and Facilities, in Kilowatt-Hours

 Kilowatt-hours    in billions
50                                                                                             4

20     -

10     -

 oil                I              1      ,      t         I          1        ,         I
       1986       1987           1988   1989   1990      1991       1992     1993      1994     1995
                                                Fiscal years

Note: The conversion factor for electricity is 3,142 Btu per kilowatt-hour.

Source:       Developed by GAO from data provided by FEMP.

Officials at DOE’s Energy Information Administration, DOD, and FEMF’were
unable to provide independent estimates of federal agencies’future electricity
consumption. Whether the agencies’future rate of growth in electricity
consumption ‘can be extrapolated from the historic patterns is very uncertain.
However, if one assumes that the growth rate for the near future would
generally follow the trend of the recent past&the rate could range from an
increase of 1 percent annually to a decrease of 1.6 percent. We calculated this
range using electricity consumption by federal agencies, as reported to F’EMP
for the last 11 years. We estimated the growth rate for three recent time
periods-the last IO years, 5 years, and 3 years-which resulted in average annual
growth rates of positive 1 percent, and negative 1 and 1.6 percent, respectively.


The cost of electricity in federal buildings and facilities in &scal year 1995 for
the 28 federal agencies was about $3.5 billion. Figure 3 shows electricity’s

                                                                GAOIRCED-97-97Ft Federal Electricity   Use
portion of energy costs for the period fiscal years 1986-95in constant 1995
Fiaure 3: Electricitv’s Portion of Enerov Costs in Federal Buildinas and Facilities,
Fiscal Years 1986-95

Constant        1995 dollars in billions

       -----.r.-.q               ._*_.      =.--   -a-._                                            .----SW..
                                                             *-m.-    .-.).          ,.-a-



 o      '              I        1            I        /          ,              I              I                I     I
      1986           1987     1988,      , 1989     1990       1991           1992           1993         1994      1995
                                                      Fiscal years

Notes: These data are also presented in a bar chart in enc. III.

According to TVA’s Internal Energy Management Program Coordinator, because of the
nature of TVA’s business, TVA’s cost is based on a benchmark rate and does not
reflect. the actual cost for electricity used in station service.

Source:              Developed by GAO from data provided by FEMP.
Six agencies             accounted for about 87 percent of the federal agencies’total
electicity             costs in fiscal year 1995 (see fig. 4).

‘Enclosure II. shows each agency’s electricity costs for build&gs and facilities in
constant 1995 dollars for fiscal years 1986-95.

6                                                                             GAOIRCED-97-97R Federal Electricitg          Use

 Fiaure 4: Aaencies’ Share of Federal Electricitv Costs. Fiscal Year 1995

                                     DOD 52.3%

                                                                 22 other

              United States Postal                      Department of Veterans
              Service 8.8%                              Affairs 4.4%
                                      DOE 6.2%   GSA

 Note: GSA reports energy consumption data for buildings that it controls, including
 data for buildings leased to tenant agencies to whom GSA has not delegated the
 responsibility for operation and maintenance.

. Source:   Developed by GAO from data provided by FEMP.


 We provided copies of a draft of this report to DOE and DOD, the largest single
 federal electricity consumer, for review and comment. We met with officials of
 DOE, including the Deputy Director, FEMP, who fully concurred with the
 information presented in the draft report. FEMP also provided some clarifying
 comments that have been incorporated in the report as appropriate. For
 example, FEMP noted that we should more fully explain the extent to which
 agencies differ in reporting nondomestic electricity use. We revised our
 discussion to address these concerns. In addition, DOD fully concurred with
 the facts contained in the draft.


 7                                                GAO/WED-97-97X      Federal Electricity   Use
We conducted our review primarily at DOE’s FZMP in Washington, DC. We
interviewed officials and obtained data on electricity and energy use and costs
at F’EMP and its contractor, which performs data analysis and provides
information for FEMP’s reports. The electricity data are a subset of the energy
data that F’EMP includes in DOE’s annual report to the Congress. We
contacted officials at the Department of State, DOD, GSA, the National
Aeronautics and Space Administration, and the Panama Canal Commission to
identify how much of those agencies’reported electricity use was in the United
States- We contacted officials at the Department of State, DOD, DOE, GSA, and
TVA to discuss consumption reporting concerning energy-intensive facilities.
We discussed projected electricity use fiorn 1995 through 2000 with officials of
DOE’s Energy Information Administration. We contacted officials of the
Architect of the Capital, our own office, and the Government Printing Office to
 obtain electricity consumption data for the judicial and legislative branches.‘*

We did not verify the data obtained from FEMP, but we did discuss FEMP’s
procedures for validating the data submitted by the agencies. A ITEMP official
told us that the office idenufies significant variances, defied as 2 to 5 percent
depending on the type of information, from prior reports and asks agencies to
either explain those variances and/or provide narratives for inclusion in F’EMP’s
annual report. FEMP provides, with its annual reporting guidance, an
electronic worksheet to allow agencies to self-check their consumption and
cost data.

We conducted our work from January 1997 to March 21, 1997, in accordance
with generally accepted government auditig standards. As arranged with your
offices, unless you publicly announce its contents earlier, we plan no further
distribution of this report until 30 days after the date of this letter. At that
time, we w-ill send a copy to the Secretary of Defense and the Secretary of
Energy. We wiU also make copies available to others upon request. If you or

 ‘“According to data provided by legislative branch officials, the legislative and
judicial branches’use is less than 1 percent of the government’s electricity use.

 8                                             GAO/RCED-97-97R Federal Electricity   Use
your staff have any questions concerning this report, please contact me at (202)
512-3841. Major contributors to this report were Peg Reese, Jim Kennedy, and
Charles Hessler.

Enclosures - 3

9                                            GAO/RCED-97-95% Federal Electricity   Use
ENCLOSURE I                                                              ENCLOSURE I


Agency                                          Abbreviation

Commodity Futures Trading Commission            CFrC
Department of Agricukure                        USDA
Department of Commerce                          DOC
Department of Defense                           DOD
Department of Energy                            DOE
Department of Health and Human Services         HHS
Department of Housing and Urban Development
Department of the Interior                      DO1
Department of Justice                           DOJ
Department of Labor                             DOL
Department of State                             ST
Department of Transportation                    DOT
Deparbnent of the Treasury                      TRSY
Department of Veterans Affairs                  VA
Environmental Protection Agency                 EPA
Equal Employment Opportunity Commission         EEOC
Federal Communications Commission               FCC
Federal Emergency Management Agency             FEMA
Federal Energy Regulatory Commission            FERC
Federal Trade Commission                        FTC
General Services Adrnhhtration                  GSA
National Aeronautics and Space Administration   NASA
National Archives and Records Administration    NARA
National Science Foundation                     NSF
Nuclear Regulatory Commission                   NRC
Office of Personnel Management                  OPM
Panama Canal Commission                         PCC
Railroad Retirement Board                       RRB
Tennessee Valley Authority                      TVA
United States Information Agency                USIA
United States Postal Service                    USPS

Source: Office of Federal Energy Management Programs (FEMP).

10                                                 GAO/ICED-97-97R   Federal Electricity   Use
ENCLOSURE II                                                                                                                      ENCLOSURE II
                                               ELECTRICITY COSTS IN FEDERAL BUILDINGS
                                                  AND FACILITIES, FISCAL YEARS 1986-95

Constant 1995 dollars in millions

  Agencya       11986                         1988    1   1989      1990           1991       1992        1993        1994       1995
  DODb          1 $2,191.4    ) tWW3.8      $2,188.7 1 $2,085.4   $2,275.1       $2,129.9   $2,071.7 1 $2,098.0 1 $1,918.3    $1,831.9
                I             I
                                                                             I                        I           I

  TVAb          I       8.7           8.6       8.0         7.8       6.9            6.7        6.7         6.6       372.2     330.6
  USPS          I   264.3 1         267.6     270.5       273.9     275.0 1        286.9      288.1 1     300.7 1     305.6     307.3
  DOEb          I   308.5 1         302.9     302.3 1     292.5     284.2 I        267.9      269.2 1     228.8 1     239.7     217.7

  NASAb              108.6          113.6                                                                                         94.8
  DOJb                25.0           29.2
  HHS                 40.6           37.0                                                                                         43.9
  USDAb               32.3           38.0                                                      36.9 1      39.6 1      38.6       37.4
                                               10.6        12.7      15.j 1         12.5-
                                                                                               33.6 1
                                                                                               29.1 1
                                                                                                           28.2 I


11                                                                                                          GAOMXD-97-97R     Federal Electricity   Use
ENCLOSURE II                                                                                                                        ENCLOSURE II

  Agency”            1986        1987        1988         1989       1990        1991        1992           1993       1994        1995
  DOL                 15.6        15.1        14.9        14.2        14.2        14.0        14.0          14.3       14.7         14.4
  USIA                   0           0           0        11.1         7.4         8.3         9.3           8.6       12.9         11.5
  EPA                  7.4         6.6         7.0         6.3         7.0         7.6         7.4           6.9         7.1         7.9
  STb                  4.8         4.7         4.3         4.1         4.2         4.3         4.3           6.1        6.7          6.8
  NARA                   0           0           0           0           0          0           0            1.9        4.7          5.4
  PCCb                 3.9         4.3         4.1         3.7         4.0         4.0         3.7           3.7        3.8          3.8
  HUD                  2.4         2.2         2.1         2.0         2.2         2.1         2,2           1.9        1.8          1.8
  FEMA                 1.1         1.2         1.3         1.4         1.6         1.5         1.5           1.7        1.5          1.4
  OPM                  1.4         1.3         1.3         1.2         1.3         1.3         1.3           1.1        1.1          1.1
  FCC                  0.2         0.2         0.2         0.2         0.2        0.2         0.2            0.2        0.1         0.1
  Other”               4.3         5.0         5.2         5.8         5.5        3.1         2.9            1.9        2.1         2.4
  Total            $3,55&l     $3,592.7    $3,525.5    $3,453.3    $3,662.1   $3,544.5    $3,449.7    $3,460.3      $3,666-l    $3,501,5

aAbbreviationsfor agency names are contained in enc. I.

bFor this agency, the costs include those for energy-intensive operations, which FEMP tracked separately.

‘“Other” includes, for certain years, CFTC, EEOC, FEW, FTC, NARA, NRC, NSF, RRB, and USIA.

Source: Developed by GAO from data provided by FEMP.

12                                                                                                           GAO/RCED-97-97R Federal Electricity   Use
ENCLOSURE ItI                                                                ENCLOSURE III
                        AND FACILITIES, FISCAL YEARS 198&95

 Constant 1995 dollars in billions

Source:   Developed by GAO from data provided by FEMP.


13                                                       GAO/RCED-97-97RFederal Electricity Use
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