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‘Better Buildings’ Campaign Promises Efficiency Incentives

Friday, February 4, 2011

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President Obama launched his “Better Buildings Initiative” campaign during a visit to Pennsylvania Wednesday, proposing a national push for a 20% gain in energy efficiency in commercial buildings by 2020.

Following his State of the Union call for increased investment in clean-energy technologies, the White House said the President’s budget plans will include a series of financing, tax-incentive, training, and other measures aimed at encouraging energy-efficiency retrofits in offices, stores, schools, municipal buildings, universities, hospitals, and other commercial buildings.
 
“Making our buildings more energy efficient is one of the fastest, easiest and cheapest ways to save money, combat pollution and create jobs right here in the United States of America, and that's what we're going to do,” Obama said in an appearance at Penn State University.

The White House said the President’s budget will propose to make American businesses more energy efficient through a series of new initiatives, including the following.

• 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 (REITs) to retrofit their properties. These changes could result in a 10-fold increase in commercial-retrofit take up, the White House said.

• More financing opportunities for commercial retrofits: The White House said 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: 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. “Partners” will commit to a series of actions to make their facilities more efficient, and 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 said it is currently working to implement a number of reforms, including the launch of a Building Construction Technology Extension Partnership modeled on the successful Manufacturing Extension Partnership at the Department of Commerce, and providing more workforce training in areas such as energy auditing and building operations.

Industry Groups Offer Positive Reviews

The White House followed the President’s message at Penn State with a roundup of favorable reaction to the building initiative. In a blog posting, White House Deputy Director of the Office of Public Engagement Greg Nelson said the initiative is getting “overwhelmingly positive” response from business leaders and industry groups, including the The Real Estate Roundtable, the U.S. Green Building Council, Building Owners and Managers Association International (BOMA), AIA, and other groups.

“President Obama’s Better Buildings Initiative sets forth an excellent blueprint to re-employ the construction workforce, modernize our built environment, and help ensure our nation’s energy security,” said Jeffrey D. DeBoer, president and CEO of the Real Estate Roundtable.

“At a time when the real estate sector is still struggling to achieve full economic recovery, incentives to encourage building-upgrade projects will leverage private investment, encourage lending, and create well-paying jobs that can’t be exported,” DeBoer said.

Clark Manus, AIA president, said the initiative “mirrors directly what the AIA has been advocating. As a profession, architects are already helping make the President’s goals a reality. Because of their leadership role in the built environment, architects are in an ideal position to help implement the President’s initiative.”

Ray H. Mackey Jr., BOMA chairman, said the initiative includes “the critical business incentives, such as the commercial building tax credit and loan guarantees, that are key to meeting the energy efficiency goals” of the President’s energy-policy program.

Green Building Council CEO Rick Ferizzi said the “entire green-building movement is incredibly grateful for President Obama's leadership in this critical step forward for America.

“We know that green buildings can and should be front and center of any credible jobs-creation program,” Fedrizzi said, adding, “The jobs supported by the green building industry can't be outsourced.”

The White House said the Better Buildings Initiative will complement the initiatives the President has already launched for government and residential buildings, including the $20 billion in funding for building energy efficiency in the American Recovery and Reinvestment Act (ARRA).

ARRA investments include a program to retrofit 600,000 residential homes and $5.5 billion for the General Services Administration for improvements to the energy performance of existing federal buildings and construction of “a new generation of energy-efficient buildings.”

The President earlier signed an Executive Order directing federal agencies to achieve zero net energy by 2030 and employ high-performance and sustainable design principles for all new construction and alterations.