Introduction
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National Update: EPAct 2005
- As of August/September 2006, there are at least eight separate bills in Congress proposing the extension of the commercial buildings tax deduction from its current December 31 st, 2007 deadline to anywhere between 2010 and 2014 and/or the increase of the deduction from $1.80/square foot to $2.25/square foot for new construction. These items are expected to be considered and decided on in late 2006 or 2007. In July/August, electrical products trade association NEMA successfully secured a sponsor for these initiatives in the House of Representatives – Melissa Hart (R – PA), whose district is just north of Pittsburgh.
- In July, 2006, Capital Lighting & Supply and sponsors Advance, Lutron, Sylvania, and Cooper Lighting (with support from NEMA experts) conducted two mid-Atlantic seminars to discuss how business owners can “Put The Lighting Tax Deduction To Work For Your Building(s).” Over 200 area building owners, facility and property managers, architects and engineers, schools/universities, and government representatives attended the seminars to enhance their understanding of the Energy Policy Act of 2005 and the benefits of lighting upgrades.
- Also in July, over 500 interested callers attended a webinar presentation sponsored by the Tax Incentive Assistance Project (TIAP) covering the commercial buildings tax deduction opportunity.
- On September 14th, 2006, the World Energy Engineering Congress featured two presentations on the Energy Policy Act of 2005 by NEMA Director of Energy Infrastructure Ed Gray.
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EPAct 2005 Opportunities Await You….
Tax deductions offered through EPAct 2005 are currently available on qualifying lighting technologies placed into service between January 1, 2006 and December 31, 2007...so don’t let the unprecedented opportunity to benefit from a lighting upgrade while taking advantage of government-sponsored financial incentives pass you by!
For more details on the commercial building tax deduction, consult the following existing as well as new and noteworthy resources:
EPAct 2005 Resources:
- On June 2nd, the IRS issued Notice IR-2006-088, its official procedures enabling commercial property owners to qualify for energy efficiency deductions. Information describing the contents and qualifications for the certification are listed in Notice 2006-52, Deduction for Energy Efficient Commercial Buildings, which can be found at www.irs.gov.
- Recently available! A website devoted solely to providing information on lighting upgrade activities and related EPAct 2005 tax deduction opportunities was launched this Spring at www.lightingtaxdeduction.org.
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Leading with Lighting
The following real-life case study helps demonstrate how U.S. military landmark Altus Air Force Base improved its lighting quality and bottom line by pursuing a lighting upgrade:
 Recently, Oklahoma-based Altus Air Force Base proved that it was not only committed to serving as a premier air mobility training location for the United States Air Force, but as a responsible community partner and Federal government team member as well. Asked to reduce its energy use by 35% by 2010 as part of a requirement of all federal agencies, the AAFB undertook a lighting upgrade that significantly reduced energy costs and consumption while improving lighting quality, facility aesthetics, and worker productivity.
The project involved the upgrade of old fluorescent T12 lamps, magnetic ballasts, and inefficient incandescent and HID lighting technology across 93 buildings on the base to new, energy-efficient systems incorporating T8 fluorescent lamps and high efficiency electronic and dimming ballasts. The upgrade also involved the use of powerful and energy efficient T5 High Output lighting systems in the base’s warehouse, shops, and hangars as well as the conversion of 250 exit signs to incorporate highly-efficient light-emitting diode (LED) technology.
As a result of the lighting upgrade measures, energy consumption at the base was successfully reduced by over 6 million kWh annually and the base will recoup its investment in just four years, reflecting an attractive return on investment of 25%. In addition, the base’s crew and residents will enjoy a more standardized and modern lighting system that enhances lighting quality while minimizing maintenance concerns.
Confirms Altus Air Force Base Energy Manager Warren Howard, “this lighting project has significantly reduced the amount of energy we consume while providing improved light levels in all areas of our facilities, particularly in the hangars. The energy savings will enable the base to make necessary capital improvements without impacting the operating budget, which is a win-win for the thousands we employ as well as the larger community.”
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News You Can Use
Electricity Rates Up 11.1% in Second Quarter 2006
According to September 2006 data published by the U.S. Energy Information Administration, the nation’s average electricity rates through the second quarter of 2005 were a total of 11.1% higher than they were for the same period in 2005, due to the impact of continued high fossil fuel prices. Electric kWh rates in the Residential sector experienced the largest year-to-year increase, rising by 11.8% between 2005 and 2006, while electric rates in the Industrial and Commercial sectors rose by 11.6% and 9.8% respectively during that period.
Average Retail Price of Electricity to Ultimate Customers by End-Use Sector, Year-to-Date through June 2006 vs. June 2005 (Source: EIA)
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Commercial Energy Consumption – According to a recent issue of Commercial Building Products magazine, eight major systems account for a typical commercial building’s total energy consumption, with lighting representing the largest energy consumer (accounting for 35-65% of total energy use):
| Commercial Building
Technology |
Percentage of
Total Energy Consumption |
| Lighting |
35% |
| Space Cooling |
27% |
| Space heating |
16% |
| Refrigeration |
7% |
| Office Equipment |
4% |
| Water Heating |
3% |
| Cooking |
3% |
| Other |
5% |
CERA Study Predicts Global Oil Output to Increase by 2015 – Although contradictory to many other expert reports forecasting peaking oil output (and resultant economic fallout), a new study conducted by Cambridge Energy Research Associates (CERA) predicts that oil and natural gas production capacity will surge by 25% to 110 million barrels per day by the year 2015 - the result of investments in new and unconventional petroleum sources like oil-sand deposits and oil shale. While the report does acknowledge the probability of continued oil production declines in the U.S. and Europe's North Sea, it anticipates considerable and offsetting increases among OPEC member nations.
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Product Spotlight
Advance’s New e-Vision® Electronic HID Ballast Drives
Two 39-Watt Metal Halide Lamps
 Joining Advance's popular and family of e-Vision ballasts supporting the market’s broad range of professional lighting needs, Advance has introduced its exclusive new e-Vision® electronic HID ballast for the operation of two 39-watt metal halide lamps. Ideal for a variety of recessed and accent lighting applications within the retail, commercial, institutional, and hospitality sectors, the 2 X 39-watt ballast supports the growing market for multi-lamp 39-watt metal halide fixtures and offers superior performance, long life, and unprecedented design freedom.
Compact and lightweight, the ballast blends easily into modern fixture designs to promote enhanced versatility and design flexibility. Offering superior lamp wattage regulation to optimize lamp color quality over life, the ballast’s electronic circuitry drives significant energy savings relative to incandescent, halogen, and magnetic HID alternatives. In addition, its HID technology lasts three times longer than halogen and up to five times longer than incandescent options.
Designed to maximize performance while minimizing costs, Advance’s e-Vision electronic HID ballast for two 39-watt metal halide lamps represents an attractive, long-lasting, and cost-efficient alternative to incandescent and halogen technology and brings the comprehensive benefits of electronic HID technology to a broader range of market applications than ever before.
Visit our website for details on our e-Vision ballasts as well as our full line of electronic HID ballasts.
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Customer Spotlight
Craig DiLouie,
Principal, ZING Communications, Inc. and
Communications Director, Lighting Controls Association
On the current state of EPAct 2005
 “The Commercial Building Deduction is finally starting to come together as an actionable opportunity for the lighting industry, and Congress is now considering about eight separate bills that would extend the effective window of the Deduction through either 2010 or 2014. Some of these bills also seek to increase the maximum allowable deduction for lighting under the Partial Allowance Rules.
While the industry must invest time to become educated on the rules and requirements, the Commercial Buildings Deduction will be implemented by exceeding the national energy standard using proven, familiar technologies, and good lighting design. Significantly, for retrofits, the economic benefit of the Deduction can improve the return on investment of such projects and help more projects qualify for capital investment by those owners demanding higher rates of return.”
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Lighting Library...
See the following recent trade article for reference information on EPAct 2005, green building, and lighting upgrade opportunities:
“EPACT Equals Opportunity for Distributors”
Electrical Wholesaling, June 2006
Read article...
“Help for Today’s Rising Energy Costs”
Energy & Power Management, July 2006
Read article...
“A Brilliant Future”
Electrical Contractor, August 2006
Read article...
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September 2006 | Volume 1 | Issue 7
For more information
on EPAct, visit:
www.energybillinfo.com
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