GAO Finds "Energy Star" Ratings Inadequately Audited

According to a GAO Report, the "Energy Star" labels placed on products as a way to signal they are "green" - and use less energy are not adequately audited. See Energy Star Program Audit Finds Fraud Vulnerability: Faked Products were Deemed Energy Savers, Matthew L. Wald, N.Y. Times, March 26, 2010.

The report is only the latest in a series involving the 18-year-old EnergyStar program, which was set up to guide the public on energy-efficient choices that could both save people money and help reduce the nation’s runaway energy consumption.

Watchdogs within the Environment Protection Agency and the Department of Energy have reported in the past that Energy Star has taken some claims of energy efficiency on faith. Yet the new study suggests that it often does so on remote control.

Congressional auditors said they were told by EnergyStar officials that some of the approvals, including the one for the gasoline alarm clock, had been issued by an automated system and that the details had probably never been reviewed by a human being.

The GAO Report indicates that "DOE and EPA officials agreed that the program is currently based on self-certifications by manufacturers." Covert Testing Shows the Energy Star Program Certification Process Is Vulnerable to Fraud and Abuse, GAO, March 2010.

The "Energy Star" program problems are not new.

In 2008, Consumer Reports conducted laboratory tests of "Energy Star" rated major appliances and found manufacturers' estimates of energy consumption and claims of comparative energy savings to be quite unreliable. See Energy Star Has Lost Some Luster: The Program Saves Energy but Hasn't kept Up with the Times, Consumer Reports, October, 2008.

In a September 2008 letter to EPA, Consumers Union, publisher of Consumer Reports, urged EPA to:

1. Update energy-use testing procedures and standards
   
2. Require independent verification of manufacturers' self-reported test results
3. Adopt a graded system to better inform consumers of relative product efficiency
4. Tougher policing of standards by federal officials and enforcement of standards, including increasing spot checks of Energy Star-qualified products.

According to the Consumer Reports Home and Garden blog,

We'd like to see independent, third-party energy-use verification for all appliances, not just Energy Star-qualified models. Another challenge for the Energy Department is to toughen energy-use standards and the test procedures they're based on. "We continue to encourage the Energy Department to update testing procedures and raise standards for inclusion in the Energy Star class of products, so that the Energy Star label will be a reliable indicator of energy savings," says Shannon Baker-Branstetter, policy analyst for Consumers Union, the nonprofit publisher of Consumer Reports and the Home & Garden blog.

Daniel DiClerico, DOE to step up energy-use checks on Energy Star-qualified appliances, Consumer Reports Home and Garden Blog, March 22, 2010.

Now, the GAO report has pointed to additional weakness in the "Energy Star" branding program, undermining the public and consumer confidence that is necessary to justify added expenditures on higher cost "Energy Star" appliances touted by manufacturers as being more energy efficient.

Also, without a scientific basis and without adequate regulatory oversight, manufacturers' claims of energy savings with "Energy Star" branded equipment cannot be relied upon in public and utility funded programs designed to cost effectively reduce the use of energy, such as those funded by the New York PSC through the System Benefits Charge. Otherwise, the ability of those programs to function properly and achieve energy savings goals will be impaired.