Introduction

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EPAct 2005 Opportunities Await You…

Though up for extension by the House and Senate, tax deductions offered through EPAct 2005 are currently available on qualifying lighting technologies placed into service between January 1, 2006 and December 31, 2008….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:

• In October 2006, NEMA issued its official “Guidance on Energy Policy Act Commercial Building’s Tax Deduction.” This document helps clarify a number of issues for engineers and contractors as it relates to qualification for tax deduction opportunities and offers the procedures and templates which, once completed, can be used by a tax accountant to prepare the necessary documentation for the IRS. This NEMA guidance document can be accessed at http:///www.irs.gov/pub/irs-irbs/irb06-26.pdf.
   
• In June 2006, 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.
   
• A website devoted solely to providing information on lighting upgrade activities and related EPAct 2005 tax deduction opportunities was launched in Spring 2006 at www.lightingtaxdeduction.org.
   
• For up-to-the-minute information on EPAct 2005 and related tax incentives, continue to visit www.efficientbuildings.org, www.energytaxincentives.org, or NEMA.org.

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National Update: EPAct 2005

• On August 4th, 2007, the U.S. House of Representatives officially approved HR 2776, "Renewable Energy and Energy Conservation Tax Act of 2007" on Saturday, which extends the energy-efficient Commercial Building Tax Deduction (CBTD) through 2013 at $1.80 per square foot. The bill was approved by a vote of 221-189. Upon final passage, the House merged HR 2776 with HR 3221, the underlying energy legislation, which passed 241-172.
  
  The House bill must now be reconciled with the Senate energy policy legislation passed in June. While the Senate Finance Committee did pass a bill that contained the CBTD extension through 2013 (at $2.25 per square foot), the full Senate did not include the Finance Committee bill in the overall energy legislation. Senate leaders are considering how best to move forward on the energy tax package.

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Leading with Lighting

The following real-life case study helps demonstrate how one institutional entity, the Vancouver Island Health Authority (VIHA), improved its lighting quality and bottom line by pursuing a lighting upgrade:

A lighter, brighter, more energy-efficient future was in store for the Vancouver Island Health Authority (VIHA) when it recently undertook a lighting upgrade within three of its Central and North Island facilities. Possessing an outdated lighting system consisting primarily of inefficient T12 fluorescent lamps driven by magnetic ballasts, three major hospitals within the VIHA network were involved in the first phase of the project. Said Nancy Gunn, VIHA’s Technical Services / Energy Manager for the Central/North area, “our main objective was to conserve energy and help sustain the environment without compromising lighting levels or quality of light.”

The solution came in the form of a system involving over 13,000 highly efficient 3-foot and 4-foot ALTO® 25 Watt low-mercury T8 fluorescent lamps from Philips Lighting Company driven by Optanium® electronic ballasts from Advance. Optimized for maximum performance and energy efficiency, the system delivers outstanding light output and significantly reduces energy consumption and energy costs without risk of interference with any electronic equipment.

Following completion of the upgrades throughout the three facilities’ collective 77,400 square meters of space, energy consumption within the three facilities has been reduced by more than 1 million kWh annually. Through the installation of a more modern and standardized system throughout the facilities, light levels have also improved significantly, and, says VIHA’s Nancy Gunn, “the staff members within the facilities have been very happy and appreciative of the change, which has definitely enhanced the work environment for both themselves and their patients.” Incorporating a system that crushed the fluorescent bulbs and captured and neutralized any mercury vapor released from the lamps, the project further involved a very important environmental aspect.

The lighting upgrade project was a tremendous success,” concludes Nancy Gunn. “Overall, we were able to increase our lighting levels, achieve projected energy saving targets, and help support the purification of our environment.” Based on the results of their initial upgrades, VIHA has launched upgrade activities at two more hospitals as well as six other health units and extended care facilities within its system. With its on-going commitment to lighting excellence and environmental ideals, VIHA will continue to serve its community in the highest and most environmentally-responsible way possible.

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News You Can Use

Electricity Demand on the Rise
According to a release by the International Electrotechnical Commission, world electricity demand could grow from 15.4 billion kWh in 2006 to 30 billion kWh by 2030….creating a greater need for measures that promote energy conservation as well as technology to help support quality transmission and distribution of electricity.

Congress Prepares to Increase Support of Green Initiatives
Based on a review of appropriations bills currently on the table, Congress may spend as much as $6.7 billion in the coming fiscal year to combat global warming, which includes $2 billion in new spending on initiatives aimed at reducing greenhouse gas emissions and oil dependency.

Average Electricity Prices Continue to Rise
Based on data from the Energy Information Administration, average retail prices through year-to-date June 2007 increased 3.8% over the same period in 2006. At a 5.2% escalation, increases in rates to industrial customers led the growth; commercial prices year-over-year increased by 3%, while residential rates increased by 2.6%.

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Product Spotlight

Advance Launches AmbiStar® Line of Electronic Ballasts for Residential and Hospitality Sectors

Designed and rated for consumer use, Advance’s AmbiStar ballasts for the residential and hospitality sectors drive a wide variety of the consumer market’s most popular fluorescent lighting options – from compact fluorescents to T5, T8, and T12 technology -- to deliver warm, comfortable, and cost-effective lighting solutions to the market’s broad range of home and hospitality users.

Offered in a variety of fixed and dimmable options for maximum flexibility, Advance’s AmbiStar ballasts for compact fluorescent lamps (CFLs) support 13 Watt, 18 Watt, 26 Watt, 32 Watt, and 42 Watt models and are ideal for such applications as downlighting, task, ambient, hallway, and staircase lighting. Designed around the exact footprint of their magnetic ballast counterparts, Advance’s AmbiStar ballasts for fluorescent T8 and T12 lamps represent easy-to-install, energy-efficient replacement solutions which optimize linear fluorescent lighting applications in the residential and hospitality sectors.

Class B FCC EMI-rated, AmbiStar ballasts fully meet EPA ENERGY STAR® Residential Lighting and consumer EMI requirements to ensure safe and reliable operation in residential settings and are further fully California Title 24-compliant. Their electronic circuitry delivers energy savings of up to 25% over magnetic fluorescent ballast technology and as much as 75% energy savings relative to incandescent alternatives and also enables them to run cooler and operate quieter than many magnetic ballast alternatives.

Delivering the combined benefits of high performance, energy efficiency, and versatility, Advance’s family of AmbiStar electronic ballasts for compact and linear fluorescent lamps deliver high-quality, cost-effective, reliable, and sustainable lighting solutions to a broad range of consumer applications.

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Industry/Customer Spotlight

Todd Jarvis
Chief Operating Officer of Atlanta-based energy service company Wheatstone Energy

On the impact that EPAct 2005 will have on the lighting upgrade market:

“We anticipate that the new Federal tax deduction opportunities available through EPAct 2005 will have a significant impact on the lighting upgrade market. With the backing and credibility now offered by the government, the market doesn’t have to “sell” the upgrade opportunity anymore. Customer response has become less of “Why should we do it?” and more focused on “How do we do it?” and “Which specific products will optimize our application?.”

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Lighting Library...

See the following recent trade article for reference information on EPAct 2005, green building, and lighting upgrade opportunities:

“Sensors Can Produce Lighting Savings”
Energy & Power Management, August 2007
Read article...

“Green Developers Break New Ground”
Building Operating Management, August 2007
Read article...

“EPAct Deductions Brighten Return on Lighting Upgrades”
Building Operating Management, July 2007
Read article...

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