Senate bill seeks to address energy efficient buildings in U.S.
A new bipartisan bill that was recently brought to the floor of the U.S. Senate could affect the commercial real estate industry in the country, as it looks to promote the use of retrofits and renovation projects to cut the amount of emissions that are associated with these structures.
According to the National Resources Defense Council's blog, the idea behind the legislation is to promote a change in the commercial real estate market, as the reduction in emissions would be just one of the benefits for companies and building owners making the change. A drop in operating costs, limited waste and healthier working environments would result from alterations to these properties.
The Commercial Building Modernization Act was introduced by Senators Olympia Snowe, Jeff Bingaman, Barbara Feinstein and Ben Cardin, and it would revamp and extend the Energy Efficient Commercial Buildings Tax Deduction. The bill will make changes to the current deduction, creating a system that would encourage the retrofitting of existing structures.
According to the news outlet, the deduction is generally known by its tax-code section name 179D, was not used as much as its creators intended, due to the fact that it provided only a small amount of savings for organizations.
This is where the new legislation differs from the previous act, as it would create a new set of incentives for companies to make the shift to more efficient structures and technology.
The bill comes as a major push is being made within the commercial real estate industry to use cost analysis and data highlighting major savings in existing projects to promote a change in the rest of the market.
According to GreenBiz, investors and other market players are looking for accurate, reliable and transparent forecasts of savings from energy efficiency projects. Not only would this data help to initiate a change, but the related and often necessary loans needed to make the changes need to be presented in conjunction with the energy cutting expenditures.
This type of dual benefit for retrofits is what the Energy Efficient Buildings Hub is trying to present to companies in the Greater Philadelphia region. This effort comprises some of the most prominent institutions in the area and is working to transform the building stock in the City of Brotherly Love to act as a national model for how retrofit projects work.