Defunding Energy Star will harm small businesses and US competitiveness
The recent announcement by the administration to defund the Energy Star program is an alarming development for small and mid-size businesses that have relied on its benchmarks for over 30 years. From a purely business perspective, the elimination of Energy Star isn't merely about labels on appliances; it directly impacts operational costs, performance consistency and market competitiveness.
The Energy Star program stands as a remarkably successful example of a public-private partnership that delivers substantial, measurable benefits to American consumers and businesses and the environment.
Energy Star has long provided clear and reliable standards that have enabled small businesses to make informed investments in energy-efficient products. This clarity translates into direct financial savings, reducing energy expenses by up to 30 percent according to the Environmental Protection Agency's own data.
Especially for small businesses operating on tight margins, these savings aren't trivial — they represent critical capital that can be reinvested into core business activities such as product development, hiring additional employees or expanding market reach.
Beyond immediate cost reductions, Energy Star has established an essential standardization in measuring and reporting appliance and equipment performance. Small business owners have relied on these standards to make purchases confidently, knowing they are investing in products that perform efficiently and reliably over their lifespan.
Without the program, businesses face increased uncertainty, leading to potentially costly investments in substandard products that fail to deliver the promised efficiency and reliability.
Consumer trust, a crucial component of market competitiveness for all businesses, is also at risk. The label is widely recognized and trusted by a majority of American households, signaling verified quality and efficiency.
Its absence would likely result in an influx of misleading performance claims and unverified efficiency assertions, damaging consumer confidence and creating a competitive environment where cutting corners becomes commonplace. This race to the bottom ultimately harms businesses committed to genuine quality and performance standards.
Moreover, from an economic standpoint, the return on investment provided by the program speaks for itself — every federal dollar spent on the program results in approximately $350 in cost savings for businesses and consumers alike. Small businesses particularly benefit from these savings, which enhance profitability, improve cash flow and bolster overall economic resilience.
The decision to defund Energy Star appears driven less by fiscal prudence and more by an ideological stance against terms like 'climate change' and 'sustainability.' However, dismissing these concepts as mere political rhetoric overlooks the substantial and proven economic benefits they offer businesses and consumers.
Efficiency and sustainability are practical, financially responsible strategies that reduce operational costs, strengthen consumer confidence and enhance long-term business viability.
Ultimately, maintaining funding for Energy Star isn't about ideological debates, it's a smart business decision that helps American businesses and consumers. Preserving a program that has demonstrably reduced costs, standardized performance and protected consumer trust should be a straightforward choice for any administration committed to the economic health and competitiveness of American small businesses.
Michael Green is a senior advisor on climate and energy policy at the American Sustainable Business Network.
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