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California


The consumer electronics (CE) industry has long demonstrated a commitment to socially and environmentally responsible business practices. This emphasis on sustainability is evident in everything from green design and manufacturing of new products to electronics recycling (eCycling).

Energy efficiency is a priority for our members and the State of California, as a means to consumer savings, energy reliability and greenhouse gas (GHG) emission reductions. As the California Energy Commission (CEC) begins a new rulemaking process on a wide range of dramatically different product and equipment categories, we believe it is crucial that this state agency has the appropriate flexibility and the right data to support these regulations. This will help ensure California’s GHG reduction goals are met and consumers get real savings in their electricity costs. This will also allow for these benefits while not stifling innovation in high tech devices, and in a manner that is most cost-effective for the CEC to achieve.


 
Recent Legislation
 
In 2014, CEA supported common-sense legislation, AB 2581 (Bradford), which:
 
  • Instructs the CEC to consider the most current data provided to it prior to the commencement of a formal rulemaking proceeding to consider adoption or amendment of a standard for an appliance;
  • Allows the CEC to encourage and embrace the importance of private-sector voluntary agreements and the contributions they make to energy savings;
  • Allows the CEC to adopt a process for the repeal or suspension of a standard that it finds duplicative, outmoded or inconsistent with federal or state law; and
  • Allows manufacturers to utilize electronic labeling to meet CEC labeling requirements when appropriate.
  • However, on September 26, 2014 Governor Jerry Brown vetoed AB 2581. While the bill failed to get the governor's support, the governor stated the he and his administration are committed to ensuring the CEC follows the intentions of AB 2581.
Recent Accomplishments
 
2013 study found that despite their growing popularity in American homes, consumer electronics account for a decreasing share – 12 percent – of the average U.S. home’s electricity consumption.
 
CEA launched GreenerGadgets.org, an online resource that educates consumers about purchasing, using and recycling energy efficient devices.
 
CE industry leaders launched the eCycling Leadership Initiative with the goal of recycling one billion pounds of electronics annually by 2016 – enough electronic equipment to fill an entire 71,000-seat NFL stadium. And the Initiative is producing great results: 2012 saw an increase of 27 percent over 2011 (460 million pounds), and a total increase of 95 percent since 2010 (300 million pounds).
 
In 2012, the pay-TV industry, with support from the National Cable & Telecommunications Association (NCTA) and CEA, initiated a Voluntary Agreement that would eventually result in annual electricity savings of $1 billion or more, as the energy efficiency of set-top boxes is increased by up to 45 percent. Agreement signatories include 11 cable, satellite, and telco service providers and all major equipment vendors serving 91.9 million U.S. video subscribers, accounting for 91.3 percent of the total market in 2013. In 2013, leading energy-efficiency advocates joined with the pay-TV industry in an expanded version of the Voluntary Agreement.
 
CEA, Environmental Defense Fund and InnoCentive sponsored an open crowdsourcing Eco-Challenge to find environmentally and economically sound ways to recycle old cathode ray tube (CRT) televisions and monitors. More than 350 solvers from around the world participated in the competition, and the best solutions were awarded prizes of $1,000 to $5,000.
 
CEA’s 2013 Sustainability Report illustrates the industry’s commitment to embedding sustainable practices in how products are designed, manufactured, distributed, sold and handled at their end-of-life.

Our Industry’s Role in the California Economy
 
In a state that has struggled with unemployment, budget deficits and dwindling revenues, our industry remains a bright spot in the Golden State’s economy.
 
Not only does California have the largest amount of CE sector activity ($450 billion and 11.8 percent in overall workforce compensation), but it also has the most high-tech industry metrics including employment, wages, payroll and establishments.
 
CA High-Tech Industry
 (TechAmerica, 09)
Employment Average Wage Payroll
Los Angeles 170,000 $91,200 $15.5 billion
Oakland 82,100 $98,400 $8.1 billion
Orange County 95,000 $86,400 $8.2 billion
Sacramento 39,700 $86,000 $3.4 billion
San Diego 111,000 $93,300 $10.3 billion
San Francisco 86,600 $123,500 $10.7 billion
San Jose/Silicon Valley 225,600 $132,100 $29.8 billion
Statewide (2010) 931,000 $110,600 $102.9 billion
 
The Potential for More Regulation in California
 
In March 2012, the California Energy Commission adopted an order that began a new round of regulatory activity focused on several categories of high tech products and equipment, including computers, displays, video game consoles, imaging equipment and servers. View updates and public comments here.
 
For many years, CEA has been on the vanguard of energy efficiency initiatives related to the consumer electronics industry and has supported and advanced energy efficiency as part of the industry’s broader commitment to environmental sustainability. Our comprehensive approach to energy efficiency includes initiatives related to public policy, consumer education, research and analysis, and industry standards. CEA supports the U.S. Environmental Protection Agency’s (EPA’s) ENERGY STAR program, and our members’ cooperation and participation in this successful program goes back more than 20 years.
 
While we recognize and appreciate the CEC’s solicitation of information on products of interest, we note CEC’s statement in March 2013 that its outreach is an opportunity to “shape the development of draft efficiency standards and measures.” Rather than pursue unnecessary, California-specific minimum operating efficiency standards, test procedures, marking and labeling requirements for computers, displays, game consoles, networking equipment and servers, we favor more creative, flexible and market-oriented approaches that protect innovation, competition and consumer choice.
 
Instead of generating new regulations that add to California’s burdensome regulatory environment for businesses, CEC should defer to more cost-effective and appropriate policies, programs and industry initiatives that already exist for these electronics product categories, or explore new measures that rely on market-oriented incentives rather than regulatory mandates. The CE industry and policymakers share the goal of energy efficiency and conservation, but there are many paths to that goal.

Consider the progress made – without mandatory regulations:

  • Television energy efficiency gains are staggering; the amount of power needed per unit of screen size fell 63 percent for LCD TVs from 2003 to 2010 and fell 41 percent for plasma TVs from 2008 to 2010. In the future, LEDs and OLEDs promise ever better energy efficiency.
  • Since 2006, game console manufacturers have reduced the electrical power required for HD gaming by more than 50 percent – achieved without a mandatory or voluntary power cap.
  • Computer energy efficiency has doubled every 1.57 years – and is expected to continue at this pace for the foreseeable future.
Troublesome Regulatory Track Record
 
Since 2006, we have witnessed a troubling pattern regarding the CEC’s regulatory approach to consumer electronics. Three independent analyses discovered the use of old data, math errors and exaggerated energy savings, all of which collectively tipped the scales in favor of regulation. Despite repeated meetings, testimony, and public comments, the CEC has refused to acknowledge these flaws or correct the public record.
 
2011 – CEC Issues Regulations for Battery Chargers

 
2009 – CEC Issues Regulations for Televisions 

2006 – CEC Issues Regulations for Audio and Video Products 

A 2012 Bill Would Have Helped to Improve California’s Regulatory Framework

In 2012, we supported Assembly Majority Leader Charles Calderon’s legislation (AB 1850) that would have updated and reformed the Warren-Alquist Act to improve the regulatory framework supporting energy efficiency. The CEC’s authority regarding appliance efficiency standards has not changed significantly in more than 30 years, but the energy-using product and equipment landscape certainly has.
 
As introduced, AB 1850 would have helped to ensure that regulatory standards did not harm employment, competition or product innovation. According to the bill’s sponsor (opinion-editorial published in Capitol Weekly):
 
“If we expect industry to demonstrate good environmental stewardship, government must demonstrate a sound and reasonable regulatory approach. California must also be a good partner by not adding an unnecessary layer of regulation to hamper California businesses in a challenging economy.”

AB 1850 was defeated in August 2012. Opposition was led by the CEC, National Resources Defense Council (NRDC) and Pacific Gas and Electric Company (PG&E). As the bill moved through the legislative process in California, key provisions in the original bill were struck. The remaining regulatory reform provisions in the final version of AB 1850 – requiring the state to use current data and eliminating outdated and ineffective regulations – were ultimately eliminated by State Senator Christine Kehoe (D-San Diego).