Building on his “Winning The Future” campaign, President Obama introduced the Better Building Initiative in a speech at Penn State on Feb 3, 2011. The goals of the initiative are:
Achieve a 20% improvement in energy efficiency by 2020
Reduce business owners’ energy bills by about $40 billion per year
Save energy by reforming incentives
Create jobs and spur the economy
The President’s proposal, if adopted, will stimulate the economy and make American businesses more energy efficient through a number of initiatives:
10% Increase in tax incentives for building efficiency: Currently, a tax deduction of up to $1.80 per SF is available for expenditures on upgrades to building lighting, HVAC, and envelope. The proposal changes this from a deduction to a more generous tax credit that will encourage building owners and real estate investment trusts to retrofit their properties. This represents a potential ten percent increase in current incentive levels.
Loan Guarantees: A new pilot program through the Department of Energy will guarantee loans for energy efficiency upgrades at hospitals, schools and other commercial buildings
Federal Grants for Reductions in Local Red Tape: A “Race to Green” competition for state and municipal governments. Much of the authority to alter codes, regulations, and performance standards relating to commercial energy efficiency lies in the jurisdiction of states and localities. This proposes competitive grants to states and local governments that streamline standards, encouraging upgrades and attracting private investment.
The Better Buildings Challenge: The President is challenging CEOs and University Presidents to make their organizations leaders in saving energy, which will save them money and improve productivity. Partners will commit to a series of actions to make their facilities more efficient.
Training the next generation of commercial building technology workers: Using existing authorities, the Administration is currently working to implement a number of reforms, including improving transparency around energy efficiency performance, launching a Building Construction Technology Extension Partnership modeled on the successful Manufacturing Extension Partnership at Commerce, and providing more workforce training in areas such as energy auditing and building operations.
Small Business Administration Loans: The Small Business Administration is currently working to encourage existing lenders to take advantage of recently increased loan size limits to promote new energy efficiency retrofit loans for small businesses.
This proposal is not only great news, but it is also one of those no-brainer, long overdue ideas. Energy efficiency is good for business, less waste is good for the economy, and less greenhouse gas emission is good for the environment.
A 20% energy reduction is a good start. It may, however, be a bit modest given studies that show a 5 – 20% reduction is available my merely tweaking the operation of many facilities through a retrospective Commissioning Process. Technology improvements to the building envelope, HVAC, and lighting may be able to extend beyond the 20% target.