2030 Challenge Stimulus Plan: Emission reductions, jobs, and economic benefits across the country
President-elect Obama has committed to economic recovery, energy independence, carbon-neutral buildings by 2030, and an 80 percent reduction in U.S. greenhouse gas emissions by 2050. Architecture 2030 has developed a groundbreaking economic stimulus plan [PDF] that simultaneously addresses all of these issues, with a single investment. Kristina Kershner and I presented the 2030 Challenge Stimulus Plan to policymakers and industry leaders in the nation’s capitol last week. It is gathering steam.
The Plan takes a focused approach, strategically inserting scarce investment dollars into the economy to get the widest range of benefits. With a federal investment of $85.56 billion each year for two years, the Plan will, in just two years:
- create over 8 million new jobs and
- create a new $1.6 trillion renovation market.
In just five years, it will:
- save consumers $142.33 to 200.88 billion,
- reduce CO2 emissions by 481.13 million metric tons,
- reduce energy consumption by 6.17 quadrillion btu,
- save 1.83 trillion cubic feet of natural gas, and
- save 83.35 million barrels of oil.
The Plan accomplishes all of this and more using a simple, equitable, elegant approach that integrates a mortgage buy-down program for residential buildings and an accelerated-depreciation program for commercial buildings with the energy efficiency targets of the 2030 Challenge (see box below). By tying stimulus funding to the 2030 Challenge targets, the Plan revitalizes the U.S. economy while shifting it toward energy efficiency and clean energy.
This powerful and comprehensive Plan benefits all Americans, no matter what income level or location in the country. The new demand for energy efficiency upgrades and infusion of capital will create over 8 million new jobs, including a new $1.6 trillion renovation market that will put the construction industry back to work immediately. Due to the large number of products and services involved, investment in the building sector would spread across the U.S. and across industries (from steel, insulation, and caulking to mechanical, electrical, and solar equipment, glass, wood, metals, tile, fabrics, and paint) and sectors (from design, engineering, banking and development to manufacturing, construction, wholesale, retail and distribution).
In addition, the $142.33 to 200.88 billion in consumer mortgage and energy savings will provide much-needed disposable income to fuel economic growth. The reductions in energy consumption and CO2 emissions will put the country on the path to energy independence and signal our commitment to addressing climate change. The icing on the cake is that the cost of the Plan will be paid back each year through the new tax base created by the new jobs.
Separately, Architecture 2030 has called for updating the National Model Building Energy Codes to achieve overall energy savings, compared to the 2006 IECC for residential buildings and ASHRAE Standard 90.1-2004 for commercial buildings, of at least: 30 percent by 2010, 50 percent by 2016 and 75 percent by 2022, reaching carbon neutral in 2030.
The 2030 Challenge Stimulus Plan bridges the gap between 2009 and the implementation of the updated National Codes in 2011. While addressing the country’s immediate needs, it builds a foundation of experience and momentum, easing the transition to the updated codes that will transform the U.S. building sector by 2030. Investing in the building sector is the only investment that can accomplish all of these objectives.
The simplicity of the 2030 Challenge Stimulus Plan and its potential for wide-ranging, positive, and immediate impact have garnered a lot of attention on the Hill. The Plan is now being reviewed by Obama’s transition team.
Download the full Plan [PDF].
From Transition Team Weighing Blockbuster Housing and Stimulus Proposal by David Sassoon:
Here’s how the 2030 Stimulus Plan plan works.
If you are a homeowner, you can bring your mortgage rate down 2 or 3 or 4 points — with Uncle Sam picking up the difference — if you improve the energy efficiency of your home. It’s an offer you can’t refuse, because it means you can save hundreds of dollars on a typical monthly mortgage, plus hundreds more in reduced energy bills — in perpetuity.
Those savings immediately go in to family coffers and can get spent, stimulating the economy. At the same time, all the demand for energy efficiency upgrades creates millions of jobs. The government recoups its investment in the mortgage buy-down from the income tax collected from the newly employed. And greenhouse gas emissions go down dramatically.
Mazria walked me through a hypothetical example that highlighted the huge incentives the plan could unleash. Say you’re a homeowner with a $272,000 mortgage at 5.55%, paying about $1550 a month. You decide you want your mortgage rate to drop to 3%. In order to qualify for the reduction, you have to improve the energy efficiency of your home 75% below code, and it’s going to cost you a pretty penny: about $40,000.
Existing tax credits would take care of about $10,000 of that cost. The rest would get tacked on to your existing mortgage, bringing it up to $302,000. But, at 3%, you’d be paying only about $1280 — saving almost $300 a month on the mortgage alone, plus another $150 in reduced energy costs. The value of your home rises, you have more disposable income, you’ve given work to someone to do the upgrades for you — and s/he’s now paying federal taxes, and you’ve reduced your carbon footprint.
President-elect Obama has committed to economic recovery, energy independence, carbon-neutral buildings by 2030 and an 80% reduction in US greenhouse gas emissions by 2050. Architecture 2030 has developed a groundbreaking economic stimulus plan that, with a single investment, simultaneously addresses all of these issues.