Lawrence Berkeley National Laboratory

A growing number of jurisdictions are adopting energy efficient purchasing policies, often based on ENERGY STAR7 labeled products and the U.S. Department of Energy Federal Energy Management Program (DOE/FEMP) criteria. Potential savings from energy-efficient purchasing are about $1 billion/year for all levels of government; state and local purchasing account for more than 75% of this total. Together, state and local agencies spend annually about $50-70 billion on energy related products and $12 billion on energy bills. This scale of buying-power, if effectively harnessed, can help transform the market for energy efficient products. This paper reviews state and local purchasing programs around the country, explores the origins of these programs (including how they draw upon federal purchasing and ENERGY STAR), and discusses the strategic role of governmental and institutional buying in market transformation. Aggregating public sector demand sends a powerful market signal to manufacturers and vendors.