One of the ideas that has been floated to help small businesses (and homeowners) reduce their energy costs as well as their carbon footprint is to install their own renewables-based energy systems. And, according?to a recently released report called “Freeing?the Grid 2008″ by the Network for New Energy Choices, many states have policies in place that provide incentives for them to do so.
These aren’t the standard tax-based incentives (although those exist at both the state and federal levels, too). Instead, state governments have laws on their books that combine permitting individual systems to connect to the grid with requiring energy companies to pay for electricity that is privately generated and fed back into the grid. “Freeing the Grid” rates all 50 states on their version of these policies.
Under the NNEC’s rating system, the best state renewable energy policies are those that maximize credit for excess electricity sent to the grid, reduce unnecessary and burdensome red tape and special fees, set clear goals and targets, and provide incentives to encourage homeowners and businesses to install renewable energy systems.
States that perform poorly have policies that discourage homeowners and businesses from investing in renewable energy systems, for example, by requiring well-established, proven technologies to undergo rigorous, time-consuming, expensive reviews that dramatically increase the costs of the systems and the amount of time it takes for them to pay for themselves.
In the best of all possible worlds, small business owners can have a renewables-based system installed, contribute to the fight against global climate change, get paid for excess electricity by their local electric company, get relevant state and federal tax credits, and reduce their fuel costs — all at once!
Which only leaves the question of how, in the current credit climate, the average small business owner is supposed to pay for any of this?
And that brings us back to the Congressional yelling I mentioned.
The Senate Small Business Committee did a certain amount of yelling on the subject of small businesses and energy issues during the soon-to-be-history 110th Congress. In addition to holding four energy-related hearings on topics ranging from incipient heating fuel shortages in New England to the impact of gas price spikes on small firms, Committee Chairman John Kerry (D- MA) yelled at the Small Business Administration (SBA).
His discontent concerned provisions of the Energy Independence and Security Act of 2007, which was signed into law in December 2007 but have not been implemented by the SBA yet. Among the provisions in question is a simple change that allows SBA 7(a) Express loans to be used for the purpose of purchasing a renewable energy system.
And, voilá! There’s your financing.
And, since the Committee has been twitching for months about the decline in the SBA’s loan volume this year, no doubt they’d feel much better if more small businesses took advantage of the initiative — whenever the SBA gets around to putting it into place.
Between waiting for the SBA to either get its administrative act together or change hands and perhaps waiting for the cash flow climate to improve, it may be awhile before most small business owners could undertake their own renewable energy projects. But there are many advantages to the whole idea, enough to make it an investment worth thinking about.
Besides that, it’s just one more way that small businesses owners can be the community heroes they always are.
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About the Author: Dawn Rivers Baker, an award-winning small business journalist, regularly reports and analyzes small business policy and research as the editor and publisher of The MicroEnterprise Journal. She also blogs at The Journal Blog.