May 21, 2010
by Environmental Building Strategies
in Renewable Energy
Tags: Clean Energy, Government Mandates, Government rebates
Many are aware of the subsidies, tax credits, and grants available to property owners and utilities to install and utilize alternative energy (i.e., wind, solar, biomass, etc.). Unfortunately, many forget that these technologies need to be manufactured somewhere. The majority of the panels that go into a photovoltaic array and the large blades that make up wind turbines are currently being manufactured overseas, often in China. This directly contradicts President Obama’s plan to spur green job growth with the passage of the Stimulus Bill. Enter the SEAM Act.
The Security in Energy and Manufacturing Act extends an existing tax credit (The Advanced Energy Manufacturing Tax Credit (MTC), which provided a 30% of total project cost credit to help fund projects that expanded, or re-equipped clean energy manufacturing plants. The SEAM Act goes beyond a simple extension of the $2.3 billion program, it redefines it. Infusing an additional $5 billion into the program while substituting grants for tax credits, it will allow smaller startups who haven’t garnered the tax liability to apply for tax credits to offset some of the costs of their planned plants. It also prioritizes purely manufacturing projects over assembly plants.
This Act comes at a key time, as there are hundreds of projects that applied for credits under MTC that were denied because funding ran out so quickly. Like the “Cash for Clunkers” program, the actual interest in MTC far outweighed initial projections, proving that it was a successful program.
But why, you might ask, should we focus on clean technology manufacturing. According to the Act’s author, Representative Phil Hare from the 17th congressional district in Illinois,
“As clean energy becomes one of the world’s largest industries, forecasted at over $2 trillion annually, advanced energy manufacturing will offer one of the best chances for the U.S. to restore its manufacturing base and create good-paying jobs domestically.”
This is only one of the many reasons why the US needs to spur clean manufacturing jobs. Over the past several decades this nation has seen its manufacturing base erode. Losing out to cheaper Chinese products, the manufacturing industry, one of the largest employment sectors in the US has seen the largest decline in jobs over the past ten years. According to the United States Department of Labor, in 1998, the manufacturing sector employed the second highest number of workers, over 17.5 million. Sense then, the industry has seen a 2.6 percent annual decrease in jobs, which is double the rate of decline of the next-to-worst sector. Advanced energy manufacturing offers a unique opportunity to pursue an environmentally responsible agenda while creating many permanent, high-paying jobs that are desperately necessary to revive an employment powerhouse in serious decline. With the promise of huge green job creation numbers to live up to, why not focus on the area of biggest potential.
The demand side makes an even stronger case to up clean technology manufacturing. With the new requirement that 25% of each state’s energy portfolio must come from clean, renewable energy being mulled over in Washington, and with the potential for a Carbon Cap and Trade system being introduced, the demand for huge new solar and wind farms will take off. Couple that with the improvements that are being made to the efficiencies of these technologies pushing them towards being on par with coal in terms of the production price per kW, and you start to have not only an environmental reason, and a government mandated reason, but also an economic reason. Maybe the one positive that came of out of the recent oil spill in the Gulf, is that it quieted some “Drill baby Drill” proponents. Clearly an increase in off-shore drilling is not the answer to our energy situation; why not look to an abundant and everlasting source, the sun, which creates not only solar power, but wind power as well.
Looking before the future, at the present, renewable energy production is already taking off. According to the U.S. Energy Information Administration, over the past ten years, wind energy production has increased an average of 24% annually. Over that same time period, energy production from crude oil has decreased an average of 2.4% annually. While crude oil reserves are running out, and the potential for wind and solar production is only increasing, let’s start focusing our efforts and our money on a sector that has some potential. For those of you who wonder where all this money could come from, look no further than the oil industry, which receives huge subsidies from the government so they can continue searching for an archaic fuel source that is destroying our environment. Estimates are that US Oil companies receive, according to Greenpeace, between $15 billion and $35 billion a year from tax payers in the form of avoided taxes.
September 17, 2009
by Environmental Building Strategies
in Energy, Green Building
Tags: Government rebates, Green Building, Green Building in the News
How the Stimulus Impacts Green Building
Wed Sep 9, 2009 7:55pm ED
By Jacob Arlein
I don’t know if it is Obama or Al Gore but the US government is starting to understand the need for sustainability. The American Recovery and Reinvestment Act of 2009 was signed into law by President Obama in February to stimulate the sagging US economy. By injecting $690 billion to improve infrastructure…
The previous article that was posted on this blog, written by Jacob Arlein, was recently picked up by a variety of blogs and newspapers including Reuters. Here is the link to the Reuters article http://www.reuters.com/article/mnGreenBuildings/idUS389286768020090909. This is a testament to both the strength of the article and the recent surge in interest from mainstream media sources, and subsequently the average reader, about green building.
— The EBS Team —
September 3, 2009
by Environmental Building Strategies
in Green Building, Uncategorized
Tags: Government rebates, Green Building, Stimulus Bill
I don’t know if it is Obama or Al Gore but the US government is starting to understand the need for sustainability. The American Recovery and Reinvestment Act of 2009 was signed into law by President Obama in February to stimulate the sagging US economy. By injecting $690 billion dollars to improve infrastructure the authors hoped to create millions of jobs pulling the US out of the worst recession since the Great Depression. Interspersed within this $690 billion dollars is $60 billion for green projects of which $45 billion is going specifically towards energy related programs. Within this $45 billion most will go directly towards the green building industry with some additional monies going towards large scale renewable energy production.
Whether in the form of a tax credit, grant, or subsidy, federal money is becoming more available to offset costs of greening your home or building. The breakdown of the important areas is as follows:
• $300 million for the Energy Efficient Appliance Rebate program and the ENERGY STAR® program.
• $6.3 billion from the US Department of Energy for energy-efficiency grant programs, including $3.2 billion for the Energy Efficiency and Conservation Block Grants and $3.1 billion for the State Energy Program.
• $4.5 billion for greening federal buildings.
• $5 billion for the Weatherization Assistance Program.
• $4.5 billion for Electricity Delivery and Energy Reliability to modernize and improve the electricity grid.
On the residential side, the stimulus bill has expanded existing tax credits and created new ones that cover a variety of upgrades to make your home more energy efficient. New doors, windows, insulation, boilers, air conditioners, and furnaces all qualify for a 30% tax credit that is capped at $1500. This means that if you purchase and implement any of these materials or systems that meet energy efficient guidelines you can offset 30% of the cost by applying for a tax credit. In addition, renewable energy production that homeowners employ also qualifies for a 30% tax credit, but with no cap. Geothermal heat pumps, solar water heaters, wind energy production and solar panels are all included in this group. The $300 million dollars for Energy Efficient Appliance Rebate program and ENERGY STAR program will go towards home appliances that have been certified efficient by ENERGY STAR. This money will come in the form of a cash rebate.
The commercial building industry will also see a large sum of money coming their way. This includes $3.2 billion for Energy Efficiency and Conservation Block Grants, which can be applied for by counties, cities and even Indian tribes to develop and implement projects to improve energy efficiency and reduce energy use and fossil fuel emissions in their communities. The $3.1 billion for the State Energy Program will be sent directly to State energy offices to be used for similar purposes at the state level. California has already mandated that all its state buildings be LEED Silver Certified so a good chunk of the money that California will receive will likely go directly to that endeavor. The $4.5 billion dollars allocated to greening Federal Government buildings will be focused on improving energy efficiency of all General Service Administration buildings.
The Weatherization Assistance Program is a less well known but equally effective and important aspect of the stimulus bill. The Program allocates money to improving building envelopes of low-income housing. This will not only improve the lives of tenants hit hardest by the economic downturn but also greatly improve the energy efficiency of this traditionally terrible building type. The Program seeks to lower energy costs for tenants and reduce energy drawn from the grid from low income communities.
On top of these programs $22 billion has been allocated to the Department of Transportation to improve public transportation. The aim of this money is to not only improve public transportation but also expand it in hopes of increasing its popularity and thus reducing vehicle emissions. $6 billion dollars has also gone to the EPA for cleanup of hazardous sites, revitalization of watersheds and a variety of other projects that are focused on improving destroyed natural features. The EPA is distributing this money to states based on proposals that the states have supplied on projects that are good candidates.
If you are confused by all of this you are not alone. Unfortunately, like most federal government acts the stimulus bill is massive and very hard to follow. It takes an expert to figure out where money is going and how to get it. Beyond the confusion there are several negative aspects to the stimulus bill especially concerning how the money is allocated. Most of the grants are being funneled through state governments. While this is the easiest way to go about distributing the money it is definitely not the most accurate or efficient. When the states receive the money they are often spending it how they want and not for its intended purpose. Take for example a large chunk of money supposedly going towards a program to improve and “green” schools. The states are taking this money and then using it to pay teacher’s salaries. Now I am not saying this is a terrible thing but stimulus money slated to improve buildings should not be used to balance state budgets. Additionally another hefty sum from the bill is going towards nuclear and clean coal technology. Both of these industries are not considered renewable because both are riddled with environmental problems, and consequently should not be included in a bill focused on improving the environment. Lastly, the money is slow to come. Little by little dollars are trickling to states and communities and if the desired effect of this bill was to shock the economy back into a more healthy rhythm money is going to have to come faster.
On the positive side, this bill is a leap in the right direction. As the most comprehensive and lucrative sustainability bill in history, it sets a serious standard for the United States government and its people to follow. No longer can we be complacent of wasteful actions that are detrimental to the environment. Although no amount of money is enough to reverse the harm we have already done, $60 billion dollars is a good start. Compared to the oil industry, which receives and estimated 15 to 35 billion dollars a year, it is a bit lacking. This huge sum that supports one of the worst industries, in terms of its detrimental effect on the environment, shows the vast potential of capital which can and hopefully in the future will be steered toward the recently booming green industries. Already the amount of “green collar” jobs is on the rise and the green building industry has become increasingly popular. When the economy improves and the stimulus money really starts flowing green building will no longer be a fanciful option but a mandated norm.
—The EBS Team—
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