President Obama has tried to work with Congress to develop a national energy plan, climate change rules, and renewable energy standards that will encourage business and local job creation, and save costs. But there has been no success, as Congress has been wont to pass any measure. For example, IRS code 179D, giving businesses that achieve energy efficiency gains a tax deduction, expired at the end of 2013, despite the fact that both Congressional Democrats and Republicans in conference agreed over a year ago to extend the rule and even enhance it. Promoting something that everyone agrees on, like energy efficiency, by rule just can’t happen right now.
Therefore, President Obama is trying to achieve gains in energy efficiency by two alternative means, one by Executive Branch decree and the other by the private sector. President Obama issued Executive Order 13514 and a follow up memo earlier this month that set environmental and energy goals for Federal agencies which his office administers. Federal agencies must increase energy efficiency, reduce fleet petroleum consumption, conserve water, reduce waste, support sustainable communities, and leverage Federal purchasing power to promote environmentally-responsible products and technologies.
Given that the Federal Government operates nearly 500,000 buildings and over 600,000 vehicles and purchases over $500 billion per year in goods and services, the Executive Order can have a real impact on energy use and greenhouse gas emissions. This should also be benefits for the taxpayer through energy cost savings.
The Executive Order and memo require agencies to meet several targets, as follows:
- 30% reduction in vehicle fleet petroleum use by 2020;
- 26% improvement in water efficiency by 2020;
- 50% recycling and waste diversion by 2015;
- 20% of energy use should be derived from renewable sources by 2020 (if viable);
- 95% of all applicable contracts will meet sustainability requirements, and others.
Pres. Obama has also taken his quest for energy efficiency and reducing GHG emissions to the streets, visiting several large, well-known corporations to encourage and reward them for energy investments and use them as models for others. Pres. Obama recently appeared at a California Walmart to praise the company for not just setting corporate goals, but implementing programs to improve energy efficiency and install more renewable energy sources. Pres. Obama noted the cost savings and GHG emission reduction that Walmart has achieved, as well as the American jobs created. Pres. Obama has lauded other companies, too, such as General Mills, General Motors, UTC, and others. The President’s office recently announced that several major US corporations committed to getting more energy from renewable power, such as Google, Yahoo, Apple, Ikea, Kaiser Permanente, and others.
The Obama administration has reached out to individual consumers, too. New CAFÉ standards will mean gasoline cost savings and fewer trips to fill up. New appliance standards were recently issued to reduce energy use 1.2 trillion kWh over 30 years. Studies have shown that the overwhelming source of GHG emissions for the life cycle of appliances is not their manufacture or transportation to market, but their everyday use (electricity). More energy efficient appliances will reduce GHG emissions greatly.
Overall, Pres. Obama’s new energy efficiency and renewable energy strategy is based on changing the culture of this country, to show that investing in these areas is not only the right thing to do, but also the more profitable thing to do. These companies investing in energy efficiency and renewable energy when they did not have to should remind all businesses of the opportunities for financial benefits if they address energy issues smartly. In addition, this public relations approach may interest and encourage the general public who could themselves reward firms that invest or punish others that don’t with the power of the pocketbook (sales and investments).
And it’s not just mega-firms, like GM, Apple, Google, etc. who benefit from energy efficiency. All firms can. CCES consulted for a small firm, Colonial Needle Company (www.colonialneedle.com), which recently underwent a complete energy overhaul: upgrading lights; installing new double-paned windows; installing new, better insulation; replacing an old oil boiler with a new smaller one using natural gas with thermostatic control; and installing solar hot water and PV systems. Besides the technical advice, we helped them obtain applicable financial incentives, as well.
Energy costs, which had been choking Colonial Needle’s bottom line, were reduced greatly, but they received other benefits, too. They took one section of their building that had been lying dormant and refurbished it into an area they now lease for revenue. They also noted an increase in comfort and productivity of staff. Greater revenue, reduced costs, and greater productivity, all due to energy efficiency. A business cannot ask for anything more than that! Colonial Needle will be honored in June with the Outstanding Achievement Award in Energy by the Westchester (New York) Green Business Challenge.
Marc Karell is the owner of Climate Change & Environmental Services. CCES can help your building and company become more energy efficient and maximize the financial gains. We know the newest technologies – including renewable energy sources – and how to design them to effectively reduce your energy costs in a smart way. Contact us today at 914-584-6720 or at karell@CCESworld.com.