Why Go Green?
Incentive programs fuel energy-efficient developments.
Federal, state, and local governments are giving commercial
real estate developers and owners many reasons to consider going green, mostly
in the form of financial and tax incentives.
The U.S. Energy Act of 2005 provides a number of incentives
for sustainable features in both new construction and retrofitted properties.
For a summary of these benefits, see CIRE, March/April 2006 Tax Watch. The federal government also offers specific business
tax incentives and select mortgage programs for qualified energy-efficient projects.
Visit the Commercial Building Tax Deduction Coalition at www.efficientbuildings.org for an
overview of several federal programs.
State tax incentive programs vary widely, with approximately
26 states offering some form of renewable energy tax breaks, according to www.dsireusa.org, a database of state
renewable-energy incentive programs. Other state incentives for commercial real
estate projects include rebates, grants, and loans.
Many states and local communities encourage, and in some
cases, require new developments to meet the U.S. Green Building Council’s
Leadership in Energy and Environmental Design standards. Washington,
Michigan, and California have passed legislation requiring
all government-funded projects to follow LEED guidelines, according to the
USGBC. In addition, many counties and cities nationwide including Chicago, Atlanta, Los Angeles, San Francisco,
require LEED certification on new municipal projects. Private developers in
these areas are not required to meet energy-efficient standards for their projects.