ENERGY STAR Proves Vulnerable to Easy Fraud

Now you can buy that gasoline-powered alarm clock you’ve always wanted. And ENERGY STAR apparently has some major work to do to regain its credibility.

Consumers and businesses rely on the EPA/DOE ENERGY STAR program to identify energy-saving products that will perform as well or better than non-energy-saving products. The program is promoted through tax credits and appliance rebates, and Federal agencies are required to purchase certain ENERGY STAR-labeled products. Several categories of lighting are involved in the program, including compact fluorescent lamps, residential compact fluorescent luminaires and, more recently, LED luminaires and integral LED replacement lamps.

On March 26, 2010, the U.S. Government Accountability Office (GAO) published a report based on an investigation of concerns that the program is vulnerable to fraud and abuse involving obtaining ENERGY STAR partnership status for bogus companies and ENERGY STAR labeling for fictitious products. The GAO used four bogus manufacturing companies and fictitious people to apply for partnership and submitted 20 make-believe products with fake energy-savings claims.

GAO writes:

GAO’s investigation shows that Energy Star is for the most part a self-certification program vulnerable to fraud and abuse. GAO obtained ENERGY STAR certifications for 15 bogus products, including a gas-powered alarm clock. Two bogus products were rejected by the program and 3 did not receive a response. In addition, two of the bogus ENERGY STAR firms developed by GAO received requests from real companies to purchase products because the bogus firms were listed as ENERGY STAR partners. This clearly shows how heavily American consumers rely on the ENERGY STAR brand.

And:

GAO found that for our bogus products, certification controls were ineffective primarily because ENERGY STAR does not verify energy-savings data reported by manufacturers. ENERGY STAR required only 4 of the 20 products GAO submitted for certification to be verified by an independent third party.

The bogus products included:

* Gas-powered alarm clock: the size of a small generator and powered by gasoline, while claiming to save energy (the product’s marketing description stated: “Gas-powered clock radio is sleek, durable, easy on your electric bill, and surprisingly quiet”) (these GAO investigators clearly have a sense of humor)
* Geothermal heat pump: reported energy use data more efficient than any other similar product (at the time of submission); data was not questioned
* Computer monitor: approved within 30 minutes of submission
* Refrigerator: approved and listed on ENERGY STAR website within 24 hours
* And, my personal favorite, the Feather-Duster Fly-Strip Air Freshener (alleged to be an air purifier), actually a standard space heater with strips of flypaper and a feather duster glued to its front (see photo), which was approved in 11 days and subsequently listed on the ENERGY STAR website

Prior DOE, EPA and GAO reports have found that current ENERGY STAR controls do not ensure products meet efficiency guidelines. At briefings on the GAO’s investigation, DOE and EPA officials agreed that ENERGY STAR is currently based on self-certifications by manufacturers, but pointed out there are after-market tests and self-policing that ensure standards are maintained. GAO did not test or evaluate controls related to products that were already certified and available to the public.

EPA and DOE had better address this to restore confidence, and fast.

No residential CFL lighting products were involved. For LED and other SSL products, though, the Department of Energy, on behalf of EPA, which runs the LED fixture and replacement lamp programs, conducts testing on applicant products to confirm that performance meets or exceeds the necessary criteria, making it difficult to obtain the ENERGY STAR mark under false pretenses.

Click here to read the report.

Hat tip to Randy Smith at the Lighting Design Lab for turning me on to this important story.