For more on the financial crisis, check out GlobeSt.com's Webinar , "Wall Street In a Freefall—The Winners and Losers."
For once, Wall Street red ink may help the future become decidedly greener--thanks to the US government, which is encouraging sustainable energy in both its economic bailout package and through a Department of Energy program.
In order to attract recalcitrant congressmen to approve the $700-billion Wall Street bailout bill that had been rejected in late September, various earmarks and sweeteners were included that ensured its passage on Oct. 3. But perhaps none will have a more enduring benefit than rolling the Energy Improvement and Extension Act of 2008 into the bill, thereby extending credits for renewable energy use. The result could decrease the price and thus increase the use of solar panels and other renewable energy sources in new construction.
The bill extends the 30% investment tax credit for solar energy property and qualified fuel cell property, as well as the 10% investment tax credit for microturbines, through 2016. Most affected, observers say, will be the solar business. The eight-year extension of the tax credits removes most concerns about investing in solar technology.
"This should drop the cost of panels," says Jerry Yudelson, a principal of Tucson-based Yudelson Associates, a green building consultancy. "This gives some continuity, almost for the first time, for solar tax credits."
The bill also includes a number of incentives including: extending production tax credits for wind and refined coal to Dec. 31, 2009 and to Dec. 31, 2010 for other sources; and a new 10% investment tax credit for combined heat and power systems and geothermal heat pumps. It also authorizes $800 million of new clean renewable energy bonds to finance facilities that generate electricity from wind, closed-loop biomass, open-loop biomass, geothermal, small irrigation, qualified hydropower, landfill gas, marine renewable and trash combustion facilities. Including the Act in the bailout sped up an existing process.
"It's hugely important, but all it really did was extend some existing laws that we figured would be extended," says Mark Peternell, VP of sustainability for Jacksonville, FL-based Regency Centers, which has developed a GreenGenuity program that is pursuing LEED certification for 20% of its new projects in 2008, 40% in 2009 and 60% in 2010, and extending sustainable practices to its existing centers. "But without that credit, solar is a non-starter."
"The big problem (behind passage of the independent bill) was always the cost," Yudelson says. "But when you're talking about $700 billion, $20 million doesn't seem like much."
And it's not the only recent example of the US government encouraging energy management. This week, Regency was selected to participate in the US Department of Energy (DOE) Net-Zero Energy Commercial Building Initiative (CBI) as a National Account. The shopping center developer was chosen among 21 companies in retail, finance and commercial real estate to work with two DOE National Laboratories to speed market adoption of energy-saving technologies and produce energy-efficient buildings. The $15-million awards can be continued in future years, depending on success and funds availability.
"The focus is on energy efficiency, a lot of which is design expertise, such as what parts of a building need insulation, and tracking electrical loads," Peternell says. "[For example,] typical retail buildings have individual HVAC units. A central provides benefits," as long as energy use is properly apportioned among the tenants.
The goal is to enable cost-effective energy savings of 50% above the standard set by the American Society of Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE 90.1) for new commercial building designs, and a savings of 30% for retrofits to existing buildings.
"This is an ambitious project which is designed to improve the energy efficiency of commercial buildings. Working with leading US companies in a variety of sectors, we believe that we can achieve the nation's goals of reducing energy use and carbon emissions, plus set an example that other commercial building owners can follow," says John Mizroch, US Department of Energy acting assistant secretary for energy efficiency and renewable energy, in the announcement of the program.
Most important, the strategies created will be shared throughout commercial building development. "The best practices," Peternell says. "will be shared."
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