Recording in progress.

Good morning, everyone.

I'm Charles Allen, Ward Six Councilmember and Chair of the Council's Committee on Transportation and the Environment.

Today is Monday, May 4th, 2026, and we are convening in person in room 120 of the John A.

Wilson building, as well as virtually over the Zoom platform.

The time is now 9 36 a.m.

and I'm calling to order this budget oversight hearing of the committee.

Today we're gonna hear from government witnesses regarding the mayor's FY2027 proposed budget for the Department of Energy and Environment in the DC Sustainable Energy Utility.

The Department of Energy and Environment, or DOEE, is the district's leading agency for energy and environmental issues.

The agency's mission is to improve the quality of life for residents of the district by protecting and restoring the environment, conserving natural resources, mitigating pollution, increasing access to clean energy, and educating the public on achieving a sustainable future.

DOEE has wide-ranging responsibilities, including enforcing environmental regulations, wildlife management, developing energy policies, issuing permits, and providing funding, technical assistance, and information to residents and businesses in the district.

The mayor's proposed FY27 operating budget for DOEE is 181.5 million dollars, representing a 28.6% decrease from the FY26 approved budget of 254 million.

The DOEE FY27 proposed budget includes a $2 million reduction in local funds and a $19.4 million decrease in special purpose revenue funds.

DC SEU offers a range of programs and services, including rebates, incentives, technical assistance, and education to support energy conservation and sustainability efforts across the city.

While DC SEU's funding is contingent on how DOEE manages their contract and sustainable energy trust fund, it's highly likely DC SEU's capacity will be significantly reduced based on the cuts to the SETF this year.

With that, we're going to turn to our panel of government witnesses.

We're going to start with DC SEU, then we'll turn to DOE.

Uh for Mr.

Burdock, what I'm going to do is um after your testimony, I'll probably start with DC SEU questions, since I have a lot more for DOEE.

We'll go through DCSEU, and then once we wrap that up, if you'd like to step away, you certainly can, and then we'll focus in with Director Jackson for the next 48 hours.

Appreciate the opportunity to testify today on the DCSU's proposed FY2027 budget.

As with previous years, I want to begin by thanking this committee and Chair Allen for its continued leadership on clean energy, climate action, and affordability for district residents.

The committee's support, particularly during challenging budget cycles, has enabled the DCSU to deliver significant benefits to residents, businesses, and the district as a whole.

I also want to thank Director Jackson and the entire DOE team for their hard work and partnership and thank the DCSU advisory board for their support, guidance, and for continuing to push the DCSU to innovate, evaluate how we support the achievement of the district's clean energy and climate goals while also saving district residents and businesses money on their energy bills.

We understand that the district is facing a challenging fiscal environment, and that the mayor and council must make difficult decisions.

We recognize that no agency or program is immune from this, and that prioritization is required across all areas of government.

We appreciate the opportunity to support council with information as they make these decisions and the need to balance immediate budget constraints with the district's long-term policy goals.

In that context, we again want to express our sincere appreciation for efforts last year and in previous budget cycles to continue funding DCSU programs.

That support, including the addition of funding through the Healthy Homes Act, has allowed the DCSU to expand electrification efforts, reduce energy burdens, and improve comfort and health outcomes for DC residents and businesses.

These investments have delivered real lasting energy cost savings to households, which are especially important for those with limited incomes.

Over the past three years, the DCSU has experienced significant budget volatility, including reductions that have required difficult operational adjustments.

In FY2024, we felt the impacts of a mid-year 14.5 million dollar reduction that affected solar for all and related low-income retrofit and electrification programs.

In FY2025, continued budget uncertainty required DOE and the DCSU to reconfigure and adjust budgets with limited ability to scale offerings as planned.

In FY2026, funding available from the Sustainable Energy Trust Fund at the beginning of the year was $24.6 million, supplemented by approximately $11 million in Federal Inflation Reduction Act funds.

Under the proposed FY2027 budget, SETF funding would be reduced to levels comparable to those last seen in FY2012, a 50% reduction over FY 2026.

This proposed reduction comes at a time when demand for DCSU services remains high and when residents are increasingly concerned about utility affordability.

As this committee is aware, PGM wholesale electricity prices have jumped 54% since 2024.

Energy affordability is a growing district-wide concern.

Many households are facing higher energy burdens as bills fluctuate with seasonal heating and cooling needs.

Changes in energy supply costs and the reality that much of the district's housing stock, especially older row homes and multifamily buildings, were not built to modern efficiency standards.

For residents on fixed or limited incomes, even modest bill increases can force difficult trade-offs between paying for electricity or gas and covering essentials like food, transportation, and medicine.

At a moment when utility costs are top of mind for residents and businesses, it's important to underscore that the DCSU's programs deliver proven results.

Despite significant population growth, the district's overall electricity demand in 2024 was lower than it was in 2015, an outcome driven in large part by sustained investments in energy efficiency, building energy performance standards, energy codes, and green financing.

Nationally recognized analyses, such as those highlighted in a February 2026 report from ACEE consistently show that energy efficiency costs substantially less per megawatt hour than new natural gas generation while also avoiding greenhouse gas emissions and price volatility.

As we stated in our FY2025 performance oversight testimony, we believe the DCSU is the only organization with a mandate solely dedicated to energy affordability in the district.

This is one of the core reasons the DCSU exists, to serve as the district's one-stop performance-based provider of energy efficiency and renewable energy programs to help residents and businesses reduce energy use and save money while advancing DC's clean energy and climate goals.

This year the DCSU celebrates 15 years of dedicated service to the district.

Over that period, each dollar invested through the DCSU has generated approximately six dollars in lifetime energy cost savings for DC residents and businesses.

Savings that stay in local pilots and pockets and circulate in the local economy.

Solar for All is a particular particularly strong example of this impact.

Since FY 2019, the program has supported more than 840 single-family rooftop solar installations at no cost to residents.

Over 230 community renewable energy facilities or CREPs, delivering enough solar generation to serve more than 10,000 income qualified households.

And those are located throughout the district, 105 CREPs in Ward 7, 58 in Ward 8, 25 in Ward 5, 10 and Ward 6, 18 in Ward 4, and it goes on from there.

And that ensures equitable access to clean energy benefits.

In total, single family and community solar installations will drive more than $80 million in lifetime cost savings for income qualified families.

While we are working closely with DOE to determine how programming will be adjusted under the proposed budget, the magnitude of the cuts makes it clear that impacts will be significant.

First, every dollar not invested through DCSE programs represents lost opportunity.

On average, a reduction of 1 million dollars in the DCSE budget results in approximately $6.3 million in lost lifetime energy cost savings.

Roughly 38,000 metric tons of foregone lifetime greenhouse gas emissions reductions.

Fewer green jobs for district residents.