.jpg)
Viewpoint
Moving Closer to a Sustainable Future
by Dan Jacobson
What a difference an election makes. We have gone from one of the worst environmental presidents to one of the best and things are already moving in the right direction.
For over 20 years, I have been working on environmental issues. As Legislative Director of Environment California, a non-profit organization that is focused on protecting California’s air, water and open spaces, I have dedicated myself to protecting our precious natural resources. Powerful special interests have often stood in the way of environmental progress. But the pendulum has swung and the first days of the Obama administration look very promising.
While the stimulus bill was moving through Washington, I was in Congress speaking with elected officials about ways to keep the stimulus package green and I am happy to report that we have really won when it comes to clean energy.
Not surprisingly, the oil and coal companies are fighting to stay the course. ExxonMobil and other energy conglomerates are spending millions on political contributions, ads and lobbyists to keep us on the wrong path, pushing more of the same old polluting policies.
The reality is that we have enormous untapped power. Across America, we can harness wind and the sun to power our future, leaving dirty and dangerous forms of energy behind.
On Friday, February 17, President Obama signed an economic recovery package containing nearly $80 billion in clean energy, energy efficiency, public transit, rail and green transportation funding. This is the largest investment in clean energy that our nation has seen. It’s about time that boosting the economy and protecting the environment are seen as one and the same. The following breakdown of the environmental focus of the stimulus package is a call to action; let all who have the means to create change do it for the betterment of all.
Solar
The stimulus package includes grants, instead of a tax credit, for offsetting 30 percent of the cost to install solar energy systems for residences or businesses. Large-scale solar plants, often developed to sell power to utilities, are also eligible for systems that are installed in 2009 and 2010. Consumers who buy qualified solar water heating systems can also claim a one-time tax credit that equals 30 percent of the cost. Previously, this tax credit had a cap of $2,000.
Wind
The wind production tax credit has been extended through 2012. Last October, Congress extended the credit by only one year. Wind energy developers also can opt for the 30 percent investment tax credit to offset the cost of installing a wind farm, instead of getting the production tax credit. Businesses that operate small-wind projects can get a 30 percent tax credit during the year the projects are put in service, instead of a tax credit that was previously capped at $4,000.
Smart Grid
The stimulus package includes support for the smart grid, which digitalizes the electric grid in increasing energy efficiency and decreasing costs. The government could reimburse as much as 50 percent of the expenses of carrying out smart grid demonstration projects. It also has set aside $4.5 billion for electric grid improvements, including the use of demand-response equipment which manages the demand from customers in response to supply conditions.
Energy Efficiency
Creating energy efficiency in our homes is a big part of the sustainability picture. For purchases on certain heating and cooling equipment for existing homes, consumers can get a 30 percent tax credit as part of the economic recovery package. This priority is being applied to federal buildings as well; a $5.5 billion program will make federal buildings more energy efficient, including the installation of solar energy systems.
Everyone wants to be more energy efficient; it’s just a question of how to get there. The stimulus package makes a real dent in this issue. Over $8 billion has been set aside in the package for weatherization and other efficiency measures.
With an investment of approximately $5 billion through the Weatherization Assistance Program and about $3 billion for the State Energy Program, the Department of Energy (DOE) will partner with state and local governments to put 87,000 Americans to work and save families hundreds of dollars per year on their energy bills.
The funding will support weatherization of homes, including adding more insulation, sealing leaks, and modernizing heating and air conditioning equipment, which will pay for itself many times over.
The Weatherization Assistance Program will allow an average investment of up to $6,500 per home in energy efficiency upgrades and will be available for families making up to 200 percent of the federal poverty level. This breaks down to about $44,000 annually for a family of four, $55,140 for Alaska, and $50,720 for Hawaii. The State Energy Program funding will be available for rebates to consumers for home energy audits or other energy saving improvements; development of renewable energy projects for clean electricity generation and alternative fuels; promotion of Energy Star products; efficiency upgrades for state and local government buildings; and other innovative state efforts to help save families money on their energy bills.
The DOE’s Weatherization Assistance Program allows low-income families to reduce their energy bills by making their homes more energy efficient, reducing heating bills by an average of 32 percent, and overall energy bills by hundreds of dollars per year.
Fuel Efficient Cars
The stimulus bill would be incomplete without supporting fuel-efficient cars. A tax credit of up to $7,500 will be available for people buying a plug-in hybrid electric car. The new law expands the previous legislation, making the tax credit available to 200,000 cars per manufacturer, instead of 250,000 for the whole car industry. A lower tax credit will be available to buyers of neighborhood electric cars, electric motorcycles and three-wheeled electric cars. $2 billion in grants will be offered to manufacturers of advanced batteries for cars and other devices in the United States.
A 50 percent tax credit, instead of the previous 30 percent tax credit, will be available for gas stations or other businesses that install alternative fueling pumps that dispense E85 fuel, electricity and natural gas. There is a cap of $50,000 per installation project. Hydrogen fueling stations would get the usual 30 percent tax credit for installations that take place in 2009 and 2010, but the cap has been increased to $200,000 instead of $30,000.
It will take more than this amazing stimulus package to solve global warming and move us in the right direction with clean energy, but now we have a fighting chance to do the right thing. What a difference an election makes.
Dan Jacobson coordinates policy development, research, and legislative advocacy for Environment California. Based in Sacramento, CA, he leads the organization’s policy agenda and advocates before the state legislature. Learn how you can help protect the environment at www.environmentcalifornia.org.