President proposes initiative to improve energy efficiency in commercial buildings
President Obama's Better Buildings Initiative will make commercial buildings 20 percent more energy efficient over the next decade by catalyzing private sector investment through a series of incentives to upgrade offices, stores, schools, municipal buildings, universities, hospitals, and other commercial buildings, according to a Feb. 3 White House release.
“The President’s new effort to encourage energy efficiency upgrades for the nation’s commercial building inventory will make our economy more efficient, more vibrant and more competitive," said Stephen E. Sandherr, CEO, Associated General Contractors of America, Arlington, Va., in a Feb. 3 release. "Given the fact that the energy consumed by the nation’s building inventory accounts for 40 percent of domestic power consumption, encouraging efficiency upgrades will do much more to safeguard our environment and reduce power consumption than any current 'cap and trade' proposal ever would. And unlike restrictive environmental legislation or regulatory actions, the President’s new proposal will actually stimulate new economic activity and create needed jobs for a construction sector that has seen unemployment rates above 20 percent for much of the past year."
The President’s budget will propose to make American businesses more energy efficient through a series of new initiatives:
- New tax incentives for building efficiency:The President is calling on Congress to redesign the current tax deduction for commercial building upgrades, transforming the current deduction to a credit that is more generous and that will encourage building owners and real estate investment trusts to retrofit their properties. These changes could result in a 10-fold increase in commercial retrofit take up, leveraging job-creating investments.
- More financing opportunities for commercial retrofits: Access to financing is an important barrier to increased retrofit investment in some market segments. To address these gaps, the Small Business Administration is working to encourage existing lenders to take advantage of recently increased loan size limits to promote new energy efficiency retrofit loans for small businesses. The President’s budget will also propose a new pilot program through the Department of Energy to guarantee loans for energy efficiency upgrades at hospitals, schools and other commercial buildings.
- "Race to Green" for state and municipal governments that streamline regulations and attract private investment for retrofit projects: Much of the authority to alter codes, regulations, and performance standards relating to commercial energy efficiency lies in the jurisdiction of states and localities. The President’s budget will propose new competitive grants to states and/or local governments that streamline standards, encouraging upgrades and attracting private sector 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. They will in turn become eligible for benefits including public recognition, technical assistance, and best-practices sharing through a network of peers.
- 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.
Read the full release.