Man, things don't look and feel all that great right now, do they? The credit crisis has American and foreign businesses shaking in their boots, and the free-falling stock market and housing sector have many of us worrying about our own personal financial futures. Throw a presidential election into the mix, and you've got a recipe for a major case of heartburn. All of these factors couldn't have come at a worse time for the renewed “green movement” that has taken hold across the country. However, state and local governments are working hard to try and keep many energy-efficient programs moving forward.
According to the American Council for an Energy-Efficient Economy, the Emergency Economic Stabilization Act of 2008, signed into law by President Bush on Oct. 3, 2008, includes the following extensions of many renewable energy tax incentives:
The Commercial Building Tax Deduction has been extended for an additional five years, through Dec. 31, 2013. Originally established by the Energy Policy Act of 2005, the deduction program applies to a building's HVAC, water-heating, and lighting system, as well as the building envelope. The lighting system deduction provides an accelerated depreciation benefit equal to the cost of the lighting system improvement or $0.60 per square foot — whichever is less.
A new tax credit for plug-in hybrid vehicles and an extension of fuel cell and microturbine credits through 2016.
On the residential front, an extension of the tax credit for efficient furnaces, boilers, air conditioners, and water heaters, as well as insulation and window upgrades for existing homes.
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 fund energy conservation efforts.
The legislation also extends the production tax credit for wind energy by one year, and offers an eight-year extension of tax credits for businesses and homeowners installing solar energy equipment. Starting Jan. 1, 2009, homeowners can qualify for a federal tax credit equal to 30% of a photovoltaic system's initial cost, and business owners will no longer be hit with an alternative minimum tax by claiming the credit. And last I checked, utility company rebates and state tax credits for renewable systems were holding strong.
I'm excited to see existing tax credits extended and new ones implemented in the renewable energy sector, but the bigger issue right now is what effect will the weakening economy have on the overall construction market — and how will this ultimately affect the recent growth we've seen in the sustainability/renewable energy markets? As financial pressures continue to mount, will owners continue to think green, or will the threat of red on their financial spreadsheets force them to return to their old ways of thinking? Let's hope the answer to this question doesn't derail the technological advancements on the product front we've seen in recent years.