Green Building News November 2008
November 3, 2008
Congress Extends Energy Efficiency Tax Incentives
On Oct. 3, 2008, the President signed into law legislation to extend many of the Energy Efficiency Tax Incentives that were first enacted in 2005 but expired at the end of 2007 or were scheduled to expire at the end of 2008. The bill also includes extensions of a variety of renewable energy tax incentives.
The energy efficiency provisions include:
- An extension of the commercial buildings tax deduction to the end of 2013.
- An extension of the tax credit for efficient furnaces, boilers, air conditioners and water heaters; and insulation and window upgrades to existing homes (covering improvements installed in 2009, but not 2008).
- A one-year extension of the new energy-efficient home tax credit, to the end of 2009.
- Three years of manufacturer tax credits for sales of high-efficiency refrigerators, clothes washers, dishwashers and dehumidifiers (2008-2010).
- A new tax credit for plug-in hybrid vehicles purchased starting in 2008 and extending until shortly after the number of qualifying vehicles reaches 250,000.
- A new 10 percent investment tax credit for combined heat and power systems (through 2016)
- An extension of fuel cell and microturbine credits to the end of 2016.
- Accelerated depreciation for smart meters and smart grid systems.
- Extension of an existing bonding program for green buildings and sustainable design, and establishment of a new energy conservation bond program that would help local and state governments to fund energy conservation efforts.
The bill pays for these provisions by restricting several oil and gas industry tax breaks and tightening some provisions on the sale of stocks.
“Extension of the energy efficiency tax incentives will help consumers save money on their energy bills due to lower consumption, and can also contribute to lower energy prices as lower demand changes the demand-supply balance that determines energy prices,” stated Steven Nadel, Executive Director of the American Council for an Energy-Efficient Economy, a nonprofit research group that helped develop the original 2005 tax incentives. He noted that the present tax incentives for new homes and appliances have been particularly effective, and predicted that the multiyear extension of the commercial buildings incentive should increase the number of qualifying commercial buildings. He also welcomed the new tax incentives for combined heat and power systems and plug-in hybrid vehicles, stating “these new incentives should help these emerging industries to grow.” On the other hand, he noted that several of the tax incentives are extended for only one year, meaning that Congress will need to revisit these incentives next year.
Renewable energy provisions in H.R.1424 include an eight-year extension of the 30 percent solar tax credit and removal of the monetary cap for residential solar electric installations.
The solar provisions in this bipartisan legislation will help position the U.S. as a global leader in the booming solar marketplace, generating thousands of green-collar jobs, promoting energy independence and helping to tackle climate change.
Key provisions of this legislation will:
- Extend the investment tax credit for residential and commercial solar installations for eight years (it was previously set to expire at the end of 2008)
- End the $2000 cap on the investment tax credit for residential solar electric installations placed into service after December 31, 2008
- Allow filers of the alternative minimum tax to claim solar investment tax credits
- Allow public utilities to claim the solar investment tax credits
- Authorize $800 million in new clean renewable energy bonds and create a new category of tax credit bonds called Qualified Energy Conservation Bonds to finance state and local initiatives to reduce carbon emissions
- Extend deductions for energy efficient commercial buildings
- Establish a new tax credit for purchasers of plug-in electric-drive vehicles
- Extend research and development tax credits
"Renewable energy and energy efficiency are our economic drivers,” said Brad Collins, Executive Director of the nonprofit American Solar Energy Society. “I applaud members of Congress for coming together to extend the renewable energy tax credits that will strengthen the new energy economy and generate green jobs at a time when they’re needed most.”
State Scorecard Highlights Model Policies to Win Race for Energy Independence
California tops the list of U.S. states employing energy efficiency as the "first fuel" to grow their economies while meeting electricity demand, combating global warming and contributing to U.S. energy security, according to a new report from the American Council for an Energy-Efficient Economy (ACEEE). The 2008 State Energy Efficiency Scorecard rated and ranked state-level action on model energy efficiency policies, programs and practices. With California claiming the number one ranking, Idaho rated as the "most improved" state since ACEEE’s first state scorecard report graded state action through 2006.
"The top ranked states are demonstrating great leadership in promoting energy independence with cost-effective energy efficiency investments," said Maggie Eldridge, Research Associate at ACEEE and lead author of the report. "By setting innovative policies and programs that help consumers save energy, states are using energy efficiency as the first line of defense against rising energy prices while increasing our nation’s energy security, fostering economic prosperity and combating global warming."
ACEEE’s state-by-state analysis found that first-place California was followed by Oregon, Connecticut, Vermont, New York and Washington. Minnesota and Massachusetts tie for seventh place with Wisconsin and New Jersey rounding out the final two spots in the top ten.
"We applaud these leading states for embracing a wide range of the proven-effective and readily-available efficiency strategies that will most quickly move our nation closer to energy independence to the benefit of our economy, environment and national security," said Eldridge. "Our scorecard puts the spotlight on the leading and most improved states to encourage others to step up their efforts to make energy efficiency the routine way of doing business and part of our everyday lives."
The 2008 report is ACEEE’s latest edition in a periodic analysis of state-by-state ranking on the adoption and implementation of energy efficiency policies, which aims to recognize leadership among the states and identify best practices. The report ranks states on a broad array of energy efficiency policy initiatives, including:
- Utility-sector and public benefits efficiency programs and policies
- Transportation and land use policies
- Building energy codes
- Combined heat and power (CHP)
- Appliance efficiency standards
- Energy efficiency in public buildings and fleets
- Research, development and deployment (RD&D)
- Financial incentives for efficient technologies
"Faced with rapidly increasing energy costs and growing concerns about power reliability and global warming, more and more states are turning to energy efficiency as a reliable, cost-effective and quick resource to deploy to meet electricity needs, reduce greenhouse gas emissions, and save consumers’ money," said Executive Director Steven Nadel, report co-author. "Our scorecard offers the states a blueprint for greening up both the environment and the economy, and it is becoming evident that more and more policymakers are realizing that it is not only the socially responsible thing to do, but it is also fiscally prudent."
Emerging Green Economy Could Create Tens of Millions of New "Green Jobs"
A new study on the impact of an emerging global "green economy" on the world of work says efforts to tackle climate change could result in the creation of millions of new "green jobs" in the coming decades.
The report entitled Green Jobs: Towards Decent work in a Sustainable, Low-Carbon World, says changing patterns of employment and investment resulting from efforts to reduce climate change and its effects are already generating new jobs in many sectors and economies, and could create millions more in both developed and developing countries.
However, the report also finds that the process of climate change, already underway, will continue to have negative effects on workers and their families, especially those whose livelihoods depend on agriculture and tourism. Action to tackle climate change as well as to cope with its effects is therefore urgent and should be designed to generate decent jobs.
Though the report is generally optimistic about the creation of new jobs to address climate change, it also warns that many of these new jobs can be "dirty, dangerous and difficult". Sectors of concern, especially but not exclusively in developing economies, include agriculture and recycling where all too often low pay, insecure employment contracts and exposure to health hazardous materials needs to change fast.
What's more, it says too few green jobs are being created for the most vulnerable: the 1.3 billion working poor (43 percent of the global workforce) in the world with earnings too low to lift them and their dependants above the poverty threshold of US$2 per person, per day, or for the estimated 500 million youth who will be seeking work over the next 10 years.
Green jobs reduce the environmental impact of enterprises and economic sectors, ultimately to levels that are sustainable. The report focuses on "green jobs" in agriculture, industry, services and administration that contribute to preserving or restoring the quality of the environment. It also calls for measures to ensure that they constitute "decent work" that helps reduce poverty while protecting the environment.
The report says that climate change itself, adaptation to it and efforts to arrest it by reducing emissions have far-reaching implications for economic and social development, for production and consumption patterns and thus for employment, incomes and poverty reduction. These implications harbor both major risks and opportunities for working people in all countries, but particularly for the most vulnerable in the least developed countries and in small island States.
The report calls for "just transitions" for those affected by transformation to a green economy and for those who must also adapt to climate change with access to alternative economic and employment opportunities for enterprises and workers. According to the report, meaningful social dialog between government, workers and employers will be essential not only to ease tensions and support better informed and more coherent environmental, economic and social policies, but for all social partners to be involved in the development of such policies.
Among other key findings in the report:
- The global market for environmental products and services is projected to double from US$1,370 billion (1.37 trillion) per year at present to US$2,740 billion (2.74 trillion) by 2020, according to a study cited in the report.
- Half of this market is in energy efficiency and the balance in sustainable transport, water supply, sanitation and waste management. In Germany for example, environmental technology is to grow fourfold to 16 per cent of industrial output by 2030, with employment in this sector surpassing that in the country's big machine tool and automotive industries.
- Sectors that will be particularly important in terms of their environmental, economic and employment impact are energy supply, in particular renewable energy, buildings and construction, transportation,basic industries, agriculture and forestry.
- Clean technologies are already the third largest sector for venture capital after information and biotechnology in the United States, while green venture capital in China more than doubled to 19 per cent of total investment in recent years.
- 2.3 million people have in recent years found new jobs in the renewable energy sector alone, and the potential for job growth in the sector is huge. Employment in alternative energies may rise to 2.1 million in wind and 6.3 million in solar power by 2030.
- Renewable energy generates more jobs than employment in fossil fuels. Projected investments of US$630 billion by 2030 would translate into at least 20 million additional jobs in the renewable energy sector.
- In agriculture, 12 million could be employed in biomass for energy and related industries. In a country like Venezuela, an ethanol blend of 10 per cent in fuels might provide one million jobs in the sugar cane sector by 2012.
- A worldwide transition to energy-efficient buildings would create millions of jobs, as well as "greening" existing employment for many of the estimated 111 million people already working in the construction sector.
- Investments in improved energy efficiency in buildings could generate an additional 2-3.5 million green jobs in Europe and the United States alone, with the potential much higher in developing countries.
- Recycling and waste management employs an estimated 10 million in China and 500,000 in Brazil today. This sector is expected to grow rapidly in many countries in the face of escalating commodity prices.
The report provides examples of massive green jobs creation, throughout the world, such as: 600,000 people in China who are already employed in solar thermal making and installing products such as solar water heaters; in Nigeria, a bio fuels industry based on cassava and sugar cane crops might sustain an industry employing 200,000 people; India could generate 900,000 jobs by 2025 in biomass gasification of which 300,000 would be in the manufacturing of stoves and 600,000 in areas such as processing into briquettes and pellets and the fuel supply chain; and in South Africa, 25,000 previously unemployed people are now employed in conservation as part of the 'Working for Water' initiative.
The report recommends a number of pathways to a more sustainable future directing investment to low-cost measures that should be taken immediately including: assessing the potential for green jobs and monitoring progress to provide a framework for policy and investment; addressing the current skills bottleneck by meeting skill requirements because available technology and resources for investments can only be deployed effectively with qualified entrepreneurs and skilled workers; and ensuring individual enterprises' and economic sectors' contribution to reducing emissions of greenhouse gases with labor-management initiatives to green workplaces.
SolarWorld Opens Largest Solar Production Facility in the USA
German Company Creates 1,000 New Jobs in Oregon
SolarWorld AG has opened the largest solar cell production facility in the USA. In Hillsboro, Oregon, the German company is investing 500 million dollars in highly advanced technology. In an integrated manufacturing process, wafer-thin silicon discs – the so-called solar wafers – as well as solar cells will be produced with an initial capacity of 100 Megawatt (MW) annually. At their final destination – on the roof or in a larger power plant – this equates to the electricity requirements of 100,000 people. The company announced that the capacity will be expanded to 500 Megawatt in the next three years.
The investment at the Hillsboro location will create 1,000 new jobs by the year 2011. 250 people have already been employed for the start of production.
SolarWorld AG with its headquarters in Bonn/Germany has been the major solar technology producer on the American continent since taking over the solar activities of the Shell Oil Company. In addition to the new site in Oregon, the group also operates a manufacturing facility for solar modules in Camarillo, California. The main manufacturing site of the company continues to be Freiberg in Saxony/Germany.
National GreenBuilding Conference - Dec. 3-4
This National GreenBuilding Conference, held in Toronto, will focus on all aspects of green design, construction, retrofit and maintenance leading to high performance buildings. More information.
Green California Schools - Dec. 8-10
Held in Anaheim, CA, covers every aspect of creating healthy, sustainable schools – from green building and facilities management to developing green curriculum. More information.
Ecobuild - Dec. 8-11
Comprehensive Conference and Exhibition gives you all the information you need to build smarter, more sustainably, and under budget. Held in Washington, DC. More information.
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