Today, President Obama is announcing a “Better Buildings Initiative” aimed at increasing the energy efficiency of commercial buildings by 20 percent during this decade, relying upon a series of incentives to upgrade offices, stores, schools and other municipal buildings, universities, hospitals, and other commercial buildings. This initiative builds upon his statements on harnessing clean energy in the State of the Union Address in late January and is timed as part of the rollout of his upcoming submission to Congress of the Fiscal Year 2012 Budget Request.

A link to the White House press release this morning is provided below:

Among the key elements of the new initiative are:

  • New tax incentives for building efficiency, including modification of the Section 179D tax deduction for commercial building retrofits by turning it into a more generous credit. The White House estimates that the changes to this tax policy could result in a “ten-fold increase in commercial retrofit take up.”
  • Expanded financing opportunities for commercial retrofits, including the Small Business Administration and a new pilot program through the Department of Energy to guarantee loans for energy efficiency upgrades at hospitals, schools and other commercial buildings.
  • Competitive grants for state and municipal governments as part of a new “Race to Green” that will encourage those governments to streamline regulations and attract private investment for retrofit projects.
  • A “Better Buildings Challenge” aimed at corporate CEOs and university presidents to encourage them to demonstrate leadership in saving energy. Participants will be expected to commit to a series of actions to make their facilities more efficient and will in turn become eligible for benefits including public recognition, technical assistance, and best-practices sharing through a network of peers.

These initiatives will be the subject of Congressional consideration both in the annual budget process and as broader energy tax legislation is developed in the coming months.