Following his call in THE State of the Union for clean-energy advances, President Obama proposed new efforts to improve energy efficiency in commercial buildings across the country. His “Better Buildings Initiative” would aim to increase energy efficiency in commercial buildings by 20 percent over the next decade, and it could reduce energy bills by about $40 billion at today’s prices. Through a series of incentives, the plan will encourage private-sector investment to upgrade all types of buildings, ranging from offices and schools to universities and hospitals. According to the U.S. Department of Energy (DOE), in 2010, commercial buildings consumed roughly 20 percent of all energy in the U.S. economy.

The president’s budget, which is subject to congressional approval, will propose to make American businesses more energy efficient through a series of new initiatives: e.g., new tax incentives for building efficiency to transform the current deduction to a credit that is more generous and that will encourage building property retrofits; more financing opportunities for those commercial retrofits, with the Small Business Administration working to encourage existing lenders to take advantage of recently increased loan size limits to promote new energy-efficiency retrofit loans for small businesses; and a new DOE pilot program to guarantee loans for energy-efficiency upgrades at hospitals, schools and commercial buildings.

Other elements of the proposal are a “Race to Green” for state and municipal governments that streamline regulations and attract private investment for retrofit projects, a Better Buildings Challenge to spur CEOs and university presidents to make their organizations leaders in saving energy, more training for the next generation of commercial building technology workers by launching a Building Construction Technology Extension Partnership modeled on the successful Manufacturing Extension Partnership at the Department of Commerce, and the provision of more work force training in areas such as energy auditing and building operations.

The White House said the Better Buildings Initiative will complement programs already launched for government and residential buildings, including the $20 billion in funding for building energy efficiency in the American Recovery and Reinvestment Act.