AIA urges Congressional leaders to prioritize energy efficiency in infrastructure debate
A coalition of energy businesses, trade associations, researchers, and advocacy organizations ask Congress to link energy and infrastructure
Infrastructure is a powerful driver of economic growth and inclusive development, capable of boosting aggregate demand today and laying the foundations for future growth. It is also a key element of the climate change agenda. Done poorly, infrastructure is a major part of the problem; done right, it is a major part of the solution. AIA took the opportunity this week to urge Congress to ensure that embedded energy and sustainable design are considered in any and all infrastructure discussions.
Over the next 15 years, more than $90 trillion in infrastructure investment will be needed worldwide. That is more than twice the value of the entire stock of infrastructure today; it will also require total annual investment to increase more than twofold, from $2.5-3 trillion to above $6 trillion. Around 75 percent of this investment will have to take place in the developing world, particularly middle-income countries due to their growth needs, rapid urbanization, and already-large infrastructure backlogs. As such, AIA argues that any infrastructure package considered by Congress must include incentives to improve buildings' energy and environmental efficiency technologies.
Given the wide-scale impact buildings have on the environment and their high consumption of energy, the need for them to be energy efficient is well-documented. To that end, AIA is pursuing multiple public policy solutions to encourage energy efficiency investments, namely by continuing and creating incentives for building owners in the federal tax code.
AIA continues to advocate for the 179D energy efficiency tax deduction and for the repeal of the Foreign Investment in Real Property Tax Act of 1980 (FIRPTA). FIRPTA is a US tax law that discourages investment in communities of all sizes. AIA is also working with bipartisan Congressional leadership and other groups in the built environment to develop a new tax incentive that focuses on energy efficiency improvements in existing building stock. The Energy Efficiency Qualified Improvement Property (EE-QIP) would incentivize building owners to invest in energy efficient technologies for their existing properties by improving the conditions for them to deduct retrofitting expenses. Eligible deductions would include many types of energy efficient improvements, such as the building envelope, mechanical insulation, exterior lighting, and building management systems. All of these policy priorities should be included in any federal infrastructure bill. This Congress must address these critical issues.
Whether by incorporating energy efficient technologies in buildings or elsewhere, without the gains in energy efficiency made since 1973 the US economy would today require at least 70 percent more energy than we currently consume. Between then and today, US gross domestic product has tripled while energy consumption has only risen by about 30 percent. Improving energy efficiency is one of the most effective policy strategies for addressing the threat of climate change—both in terms of reducing emissions and enhancing the resilience of buildings, the industrial sector, transportation, and energy systems—while also representing an extraordinary bipartisan opportunity to boost economic growth, add to the 2.25 million jobs in the energy efficiency sector, and improve US energy security and global competitiveness.
Energy efficiency would improve the cost-effectiveness and sustainability of any investments in infrastructure, including critical improvements across the entire buildings sector, water and wastewater treatment facilities and distribution systems, the power grid, and our increasingly connected transportation systems. As it stands, more than 80 percent of the world’s primary energy supply and more than two-thirds of its electricity are derived from fossil fuels. Infrastructure alone accounts for around 60 percent of global greenhouse gas emissions. If the world follows the same old approaches in building new infrastructure, it would lock in polluting, resource-intensive, and unsustainable pathways to growth.
Delivering sustainable infrastructure at scale will require strong public policy and responsive private-sector entrepreneurship. Policymakers at all levels of government, but especially on Capitol Hill, have an opportunity to work together on an issue that has historically been partisan. AIA hopes to change that by clearly articulating strategies for sustainable infrastructure investment and embedding them in comprehensive frameworks for sustainable growth and development. Only with such integrated strategies can policymakers offer the level of coherence needed to maximize the effectiveness of infrastructure policy. In so doing, this will also instill confidence in the private sector to do its part.
To help advance this issue in Congress, AIA is asking architects to visit the Architect Action Center and use the tools there to immediately and easily contact their member of Congress.
In addition, AIA is encouraging architects to text AIA to 40649 to join Architect Action Alerts and receive timely updates on this and other issues impacting architects.