and the specific points of constructive criticism that you have made; we are actively searching for this sort of assistance and guidance and criticism and will be working on it, and probably the staff will be searching you and your staff out in the near future to discuss these matters in greater detail.

I want to commend you for the legislation you have personally sponsored in this area because you, on your own, have been running a parallel course here virtually with the same legislation we have had in mind. I particularly would like to ask my staff to consult with you and your staff on the parallel legislation that would go to the other committees such as Ways and Means and Banking and Currency. We have legislation being drafted for tax incentives and mortgage incentives also. These incentives that you referred to, the tax credit for private participation and tax incentives for industry, I think, are terribly important.

Your line of thought seems to be virtually parallel. The only difference is in detail between what you have been doing and we have been doing as far as essentially pushing our society off the diving boardthe manufacturing industry and the homebuilding industry and the private citizens-into the use of solar energy.

We will be cooperating with you in every way. I very much appreciate your testimony.

Congressman Brown, do you have any questions?

Mr. BROWN. I second the remarks of the chairman with regard to the importance of the initiative you have taken, Mr. Vanik. I have some questions which we do not need to explore fully with regard to the nature of the tax incentives which, I think, may be an important part of the program of taking this away from demonstration to widespread practice.

You suggested tax credit or improvement to the taxpayer's residences. That would be a tax credit for Federal income tax purposes? Mr. VANIK. Yes. It would be specifically related to-and it would have to be certified by the Treasury as something which would be eligible for a credit.

Mr. BROWN. Property owners today can get a credit, of course, or a deduction at least for interest payments on home mortgages, and this would be comparable to that, I presume?

Mr. VANIK. It would only be a one-time credit or perhaps it could be amortized for the life of the facility. In other words, if it were a major investment, we might consider providing a 5-year writeoff for one-fifth of the cost each year for 5 years for the cost of putting in a system of insulation or a heat pump or a solar facility. But, generally, for homeowners, I believe a straight one-time credit would be most effective and useful.

Mr. BROWN. The larger share of the homeowner's taxes is in the form of property taxes to the local government jurisdiction. There is no way you visualize that we could approach that?

Mr. VANIK. Not unless we dealt individually with each of the 50 State legislatures..

I think it would be difficult-I think we could leave the question. open, although it is a good issue. I would say that in the outset, it might be well to narrow the recommendation to the standard credit or to the amortization approach comparable to what we do under the

pollution control laws, because we have a pattern that is well estab lished in that area. I pattern my recommendations after that legislation.

Mr. BROWN. Just one additional comment.

Your proposal for a data bank in this field fits in well with the experience of NASA because for a number of years this committee has encouraged them to expand their technology utilization program, which does operate through a system of regional data banks providing domestic industrial users information about scientific development coming out in the space program. This does tie in very neatly with that already existing program in NASA.

Mr. VANIK. They have the pattern.

Mr. McCORMACK. May I also comment that-making reference to the task force on energy which we started a couple of years ago, we have had a research and development inventory assembled of all public and private research and development projects in energy. This is all computerized and updated and printed out at Oak Ridge every year. And it now amounts to 4,000 individual research and development projects going on in the country. It is available through the Government Printing Office. We could very easily key in on that with a special entry for solar energy material. It would be a simple matter to assemble this from the computer, all solar energy related information. And then we could circulate it as we have done in general-circulate it to all people involved with solar energy in any way and ask them to update it and critique it and criticize it and look for omissions. Mr. VANIK. I might say, Mr. Chairman, that I would hope that your recommendations need not be modest, because I feel that the American people are prepared to pay for this. I am among the sponsors of the energy trust fund concept. I think we ought to put it together right now. That is a matter within my committee, and I would appreciate it if the members of this committee would urge the Ways and Means Committee to consider having meetings on development of an energy trust fund out of which there would be adequate funding for those areas that we might decide to go forward on.

Mr. BROWN. That is a new version of the gasoline

Mr. VANIK. It is gasoline and utility bills and everything. It could cover the spectrum. I have always felt that we could probably go 3 or 4 cents on gasoline. The President has recommended 50 or 60 cents a gallon. A proposal for such a major tax increase is incredible and unworkable. I think if 3 or 4 cents tax on gasoline were to go into an energy fund, that it ought to be complemented by a small tax on natural gas and utility bills.

[Responses for Mr. Vanik appear in Appendix B.]

Mr. McCORMACK. We will recess this meeting of the subcommittee until one of the members of the subcommittee returns.

We are in recess.

[Recess.]

Mr. SYMINGTON. The subcommittee will resume the hearings and will be shortly joined by the other members. I think at this time we would appreciate receiving at the witness table Mr. Richard Schoen, architect, of the UCLA School of Architecture/Urban Planning, Mr. Frederick Weinhold, senior engineer of the Energy Policy Project, and Mr. Jack Bologna, director of new products development of the Glass Division of PPG Industries, Inc.

We will first hear from Mr. Schoen. We are grateful to have you here and you are welcome.

[A biographical sketch of Mr. Schoen follows:]

RICHARD SCHOEN

Education.-Bachelor of Architecture, UC Berkeley, 1961; Master of Architecture, UCLA, 1971.

Present Positions.-Member of Solar Energy Team and Architectural Consultant to Caltech's Environmental Quality Laboratory; practicing Architect and partner in the firm of Lomax Associates-Architects, Los Angeles; and a member of the faculty at UCLA School of Architecture and Urban Planning.

Special Qualifying Experience.-He was a member of the NSF/NASA Energy Panel, serving on the subpanel concerned with solar/thermal technologies for water heating and space conditioning structures.

Past Experience.-In 1970-1971, he served as a consultant to the Aircraft Division of Northrup Corporation in the area of social problem solving in relation to urban problems and industrialized housing.

In 1971-1972, he was a Research Associate (Consultant) for Herman Miller Research Corporation, Ann Arbor, Michigan, developing studies in user-determined interior environments, new forms of total facilities delivery systems, and recommendations for joint venture arrangements for the parent corporation, Herman Miller, Inc.

During the summer of 1971, he was one of 20 faculty members selected by NASA from around the country to participate in a program designed to explore the potential for complete systems design of housing using NASA developed systems, materials, and technology. He was a major contributor to the project report "STARSIGHT: Towards a Decision Making Mechanism for Housing". His special areas of interest include the structure and operations of the U. S. Housing industry, industrialized housing in the U. S. and Europe, and processes of change in the U. S. housing industry. He is active in seminars and conventions concerning the housing industry and was an invited participant in the recent National Academy of Engineering technical session on industrialized housing.

Mr. Schoen was also one of two architect-members of the NSF/NASA National Solar Energy Panel during 1972.

STATEMENT OF RICHARD SCHOEN, SCHOOL OF ARCHITECTURE/ URBAN PLANNING, UCLA

Mr. SCHOEN. Mr. Chairman, I would like to point out that the following statement is coauthored by my colleague, Dr. Jerome Weingart of the Environmental Quality Laboratory, Cal Tech. Therefore, when the word "we" is used, I am relating to the work done by Dr. Weingart and myself.

These views are our own and do not necessarily reflect the views of our institutions. We are especially pleased at being asked to come to testify on H.R. 10952 because it embodies many of the elements which we have concluded will be essential if the necessary groundwork that must precede widespread commercial diffusion of solar/thermal technologies is to be established.

We have been involved in a number of projects relating to the institutional issues associated with the development and widespread use of solar energy systems for buildings. At the Environmental Quality Laboratory, we are part of a small team of researchers which has initiated a project aimed at stimulating the commercialization of gas-supplemented solar water heating systems for new apartment units in southern California.

Known as Project SAGE, which stands for solar assisted gas energy, this activity is now well underway with the project management responsibility shifted to the Jet Propulsion Laboratory, Cal

Tech, and with financial support and management participation from the Southern California Gas Co.

Both Dr. Weingart and I served on the NSF/NASA Solar Energy Panel, on the subpanel associated with solar energy applications to buildings.

We have recently completed a major study, which I have in two volumes on the desk here, of the institutional barriers to the introduction and diffusion of new community energy technologies, including solar energy applications for buildings. This project was executed under a grant from the Ford Foundation Energy Policy Project. Dr. Weingart is also a member of the California State Advisory Committee on Energy Conservation, which has established landmark standards. for energy use in new residential structures, to be implemented statewide beginning January 1, 1974. All of these activities, which were made possible initially through a major grant to the Environmental Quality Laboratory from the National Science Foundation (RANN), have converged on a specific issue. We are attempting to understand how effective programs of energy conservation and management can be implemented and widely and rapidly diffused in the real world environment of the U.S. construction/housing industry. This world includes a myriad of building code jurisdictions and a multiplicity of factors, such as builders, developers, lenders, contractors, architects, engineers, code officials, plan checkers, utilities, and so forth. This environment also has a number of well known resistances to the rapid deployment of technological innovations.

Because the issues in which the legislation is imbedded have been extensively discussed in our report for the Energy Policy Project, we are focusing our testimony on the specific language and provisions of the bill.

Certainly no discussion of the growing energy/environment problem is required for this committee. If the application of solar energy conversion techniques to buildings is to make a significant contribution to reducing the rate of growth in primary energy demand in the Nation over the next 2 to 3 decades, the appropriate technologies will soon have to move from concepts and prototypes to commercial products which can be widely and rapidly implemented.

The next section of our testimony, which I will skip, exemplifies this point. This is the area of the SAGE program which I mentioned earlier. Sufficient to say here that it is clear in order for solar energy applications to be of a real assistance on the national scale, a major industry eventually representing a multimillion dollar per year business activity will have to come into existence.

Before such an enormous enterprise develops, a considerable amount of prior work must be done.

The phases which are distinguishable but often overlapping are as follows: The first is "Innovation"-the evolution and development of a concept, such as solar air-conditioning, into a potentially commercially available product.

Phase two is "The Diffusion of Readiness." This is the process by which the industry and society in general is prepared for the eventual diffusion of the innovation. This can begin well before the full technical and economic viability of the innovation is established, through progress reporting of the demonstration projects to the industry in

honest terms which it understands and which fit its general interest and business plans.

Phase three is "The Diffusion of Innovation"-the widespread commercial application of the innovative technology within the industry. There are two associated aspects of this overall process, which we feel should be a continuing and evolving activity. The first is technology assessment-the assessment of the likely total consequences of large-scale and rapid deployment of a new technology on our society— prior to and during any broad-scale attempts at such deployment.

Such an activity is particularly relevant to the subject of these hearings since the requirement for massive deployment of new technologies such as solar energy systems to deal effectively with energy/environment problems requires a comprehensive and continually updated assessment of the impact of the technologies.

In this way deployment can be altered, or even stopped, if undesirable consequences arise. The second aspect which we shall describe, is evaluation research of the actors, processes and products of this program itself as an approach to the diffusion of technical innovation which can inform similar future efforts.

The Solar Heating and Cooling Demonstration Act of 1973 appears to address the crucial link between technological development and widespread commercial deployment-the phase we referred to as the "diffusion of readiness."

In view of the enormous amount of capital which will have to be invested if major solar equipment markets develop and are filled, this act cannot itself create a market for industry, but hopefully it can perform the crucial, and often neglected role of facilitating the transition from prototype commercial hardware to commercial "takeoff" and widespread diffusion.

Mr. SYMINGTON. While this is fascinating testimony-it will all go into the record. We were counting on about 10 to 12 minutes for each of the three of you so that we could address our questions to the panel. Would it be possible at this point to try to sum up the rest? You have another 5 minutes, but I wanted to tell you now.

[The complete prepared testimony of Mr. Schoen follows:]

We are especially pleased at being asked to comment on H.R. 10952 because it embodies many of the elements which we have concluded will be essential if the necessary groundwork which must precede widespread commercial diffusion of solar/thermal technologies is to be established. We have been involved in a number of projects relating to the institutional issues associated with the development and widespread use of solar energy systems for buildings. At the Environmental Quality Laboratory, we are part of a small team of researchers which has initiated a project aimed at stimulating the commercialization of gassupplemented solar water heating systems for new apartment units in Southern California. Known as Project SAGE (Solar Assisted Gas Energy), this activity is now well underway, with the Project Management responsibility shifted to the Jet Propulsion Laboratory, and with financial support and management participation from the Southern California Gas Company. Both of us served on the NSF/NASA Solar Energy Panel, on the sub-panel associated with solar energy applications to buildings.

2

1

We have recently completed a major study of the institutional barriers to the

1 Davis. Edgar; "Solar Assisted Gas Energy Water Heating: Feasibility for Application In New Apartments", Project SAGE Phase 1 Report. EQL Memorandum No. 11, Environmental Quality Laboratory, California Institute of Technology, Pasadena, California 91109 (November, 1973).

Schoen, Richard and Weingart. Jerome: "Institutional Problems of the Commercial Application of New Community Energy System Technologies, with Emphasis on Solar Conversion Systems" Draft Report to the Ford Foundation Energy Policy Project, November, 1973.