An Economic Development Tool for the 21st Century

While the factors that contribute to economic development are many, one is taking the lead in what is being referred to as the coming “Energy Age”.

“For the first time in history, the global community agreed to action that sets the foundation to help prevent the worst consequences of the climate crisis while embracing the opportunity to exponentially grow our clean energy economy.” Michale Brune, Sierra Club

The world’s heightened focus on energy is creating a powerful 21st century economic development tool for communities that are aware of this trend. That tool is the quest for energy efficiency! As the world focuses on reducing wasted energy, while adding more renewable energy sources, economic benefits will be realized by those communities willing to take the time to learn how to leverage this “exponential” trend.

The economic benefits of the “Energy Age”, and the trends that are developing in parallel, were measured through a study commissioned by the Northwest Energy Efficiency Council in the State of Washington. The study attempted to accurately determine what occurs when a community embraces energy efficiency. Here is a quote from an article describing the study:

“The $15,000 report that a nonprofit called the Northwest Energy Efficiency Council (NEEC) commissioned takes the unusual step of looking at energy efficiency on a macroeconomic scale, and found improving the efficiency of buildings pumps an extra $216 million a year into Washington state’s economy and creates just over 3,800 jobs.” Puget Sound Business Journal

The collection of buildings, constructed in a time when energy was relatively cheap, represents a significant challenge to achieving energy efficiency. Alternatively, those same buildings represent a significant economic development opportunity. As the Washington study detailed, improving the energy efficiency of older buildings reduces waste, saves money and increases job opportunities.

An article that described both the challenge and opportunity of older buildings discussed the important role local government plays in meeting the challenge and maximizing the opportunity:

“City governments have a critical role to play; they should implement energy benchmarking… and pass legislation that enables innovative financing mechanisms, such as Property-Assessed Clean Energy (PACE), that deliver dedicated financing for energy efficiency.” Harvard Business Review

A local government that is taking the time to learn how to leverage the economic development potential of energy efficiency is best illustrated by the actions of the organization known as Midland Tomorrow. The organization’s main objective is to empower economic development in the County of Midland, Michigan.

Becky Church of Midland Tomorrow and Scott Ringlein, CEO The Energy Alliance Group of Michigan

Midland Tomorrow’s Community Development Director, Becky Church, recently invited Scott Ringlein, CEO of the Energy Alliance Group (EAG) of Michigan, to discuss energy efficiency at a gathering of county commissioners and business owners. Scott’s presentation was titled Keeping PACE With Energy Efficiency in Michigan – An Economic Development Opportunity for the 21st Century. The presentation described the role Property Assessed Clean Energy or PACE financing (see video) that plays in overcoming the most common barrier to energy efficiency – the initial cost!

“The ultimate goal of capital finance programs is to increase business activity, thereby providing jobs and additional tax revenue.” Ziona Austrian, Ph.D.

The outcome of the event is this. A small community in rural Michigan is aligning with worldwide trends focused on improving the use of energy. One of the participants in the program voiced support of the global energy efficiency trend as he noted “I have two industrial properties that want to upgrade to solar and LEDs, and PACE would make that possible. How do we begin?”

Energy efficiency, along with financing dedicated to supporting that trend, is fast becoming the Economic Development Tool of the 21st Century!

See also: Unique Financing Options Propel Energy Efficiency Projects

Photo credit: Taitia Shelow