Are There Any Incentives for Green or Sustainable Commercial Construction in Colorado Springs?
As environmental awareness and sustainability become increasingly important in the business world, many cities across the United States are adopting policies and incentives to encourage green and sustainable construction. Colorado Springs is no exception. The city offers a variety of incentives and support mechanisms to promote environmentally friendly practices in commercial construction. These incentives aim to reduce the environmental impact of buildings, lower energy consumption, and create healthier workspaces while also providing economic benefits to developers and businesses. In this article, we’ll explore the incentives available for green or sustainable commercial construction in Colorado Springs and how they can benefit your next development project.
1. Local and State-Level Incentives
Pikes Peak Regional Building Department (PPRBD) Incentives
The Pikes Peak Regional Building Department (PPRBD), which oversees construction codes and standards in Colorado Springs, offers various programs and incentives for sustainable building practices. One of the most significant is the expedited permitting process for projects that meet certain green building criteria.
- Expedited Permitting: The PPRBD offers an expedited review and permitting process for projects that incorporate sustainable design and construction practices. This can significantly reduce the time it takes to begin construction, saving developers time and money. To qualify, a project typically needs to meet specific criteria related to energy efficiency, water conservation, and sustainable materials. This incentive encourages developers to adopt green practices by making the process of getting a project off the ground faster and more cost-effective.
- Energy Code Compliance Assistance: The PPRBD also provides assistance to builders and developers in meeting or exceeding the requirements of the International Energy Conservation Code (IECC). This support can include guidance on how to incorporate energy-efficient technologies and practices that not only meet code requirements but also qualify for additional incentives or certifications.
Colorado Commercial Property Assessed Clean Energy (C-PACE) Program
The Colorado C-PACE program is a state-wide initiative that provides long-term financing for energy efficiency, renewable energy, and water conservation improvements to commercial properties. While not exclusive to Colorado Springs, it is widely used in the area and offers substantial benefits for green construction projects.
- C-PACE Financing: This program allows commercial property owners to finance up to 100% of the upfront costs of eligible energy efficiency, renewable energy, and water conservation improvements. The financing is repaid over time through a special assessment on the property tax bill. One of the key advantages of C-PACE financing is that it covers a broad range of improvements, from installing solar panels to upgrading HVAC systems and improving building insulation. This financing mechanism can make it easier for developers and property owners to invest in green technologies without the burden of large upfront costs.
- Transferability: Another benefit of C-PACE is that the repayment obligation can transfer to the new owner if the property is sold. This feature makes it an attractive option for developers who may not plan to hold onto a property long-term but still want to benefit from green upgrades.
2. Federal Incentives
In addition to local and state-level incentives, there are also several federal programs that developers in Colorado Springs can take advantage of when pursuing sustainable commercial construction.
Federal Tax Credits for Energy Efficiency
The federal government offers several tax credits for energy efficiency improvements in commercial buildings. These credits can significantly reduce the cost of incorporating green technologies into a construction project.
- Section 179D Tax Deduction: The Energy-Efficient Commercial Buildings Deduction (Section 179D) allows building owners and designers to deduct a portion of the cost of energy-efficient improvements to commercial buildings. The deduction applies to upgrades in lighting, HVAC systems, and building envelope (roof, windows, walls). For properties in Colorado Springs, this deduction can be particularly beneficial in offsetting the costs associated with achieving high energy efficiency standards.
- Investment Tax Credit (ITC): The ITC provides a federal tax credit for the installation of renewable energy systems, such as solar panels, in commercial buildings. The credit currently covers 26% of the cost of installing a solar energy system but is set to gradually decrease in the coming years. Given Colorado Springs’ abundant sunshine, the ITC is a valuable incentive for commercial developers looking to reduce their carbon footprint and energy costs through solar power.
3. Utility Company Rebates and Incentives
Utility companies in Colorado Springs also play a significant role in promoting green construction through various rebate and incentive programs.
Colorado Springs Utilities (CSU) Programs
Colorado Springs Utilities (CSU) offers a range of incentives to encourage energy efficiency and the use of renewable energy in commercial buildings. These programs are designed to reduce the environmental impact of energy use and help businesses lower their utility bills.
- Energy Efficiency Rebates: CSU provides rebates for a variety of energy efficiency upgrades, including lighting retrofits, HVAC improvements, and energy-efficient windows and insulation. These rebates help offset the cost of installing high-efficiency equipment and materials, making it more affordable for businesses to adopt green building practices.
- Commercial Solar Rebates: CSU offers incentives for businesses that install solar photovoltaic (PV) systems. The rebate amount is based on the size of the system and can significantly reduce the upfront cost of going solar. This is particularly attractive in Colorado Springs, where solar energy is a viable and increasingly popular option for reducing energy costs and carbon emissions.
- Water Conservation Rebates: In addition to energy efficiency, CSU also offers rebates for water-saving measures such as low-flow fixtures, xeriscaping (landscaping that reduces or eliminates the need for irrigation), and high-efficiency irrigation systems. Water conservation is a critical aspect of sustainability in Colorado Springs, given the region’s semi-arid climate.
4. Green Building Certifications and Market Advantages
Beyond direct financial incentives, achieving recognized green building certifications can provide significant market advantages in Colorado Springs. These certifications can enhance a building’s appeal to tenants, buyers, and investors who prioritize sustainability.
LEED Certification
The Leadership in Energy and Environmental Design (LEED) certification is one of the most widely recognized green building certification programs globally. Buildings that achieve LEED certification are recognized for their commitment to sustainability, energy efficiency, and environmental responsibility.
- Marketability: LEED-certified buildings are often more attractive to tenants and buyers who are looking for environmentally responsible spaces. In a competitive real estate market like Colorado Springs, having a LEED certification can set a property apart from others, potentially leading to higher occupancy rates and rental income.
- Financial Incentives: Some financial institutions offer more favorable loan terms for LEED-certified buildings, recognizing that these properties are likely to have lower operating costs and higher long-term value. Additionally, some insurance companies provide discounts on premiums for LEED-certified buildings due to their reduced risk profile.
WELL Building Standard
The WELL Building Standard focuses on the health and well-being of building occupants, encompassing aspects such as air quality, lighting, fitness, comfort, and mental health. While not specifically incentivized through rebates or tax credits, WELL certification can provide a competitive advantage in attracting tenants who prioritize wellness and productivity in their workspace.
Conclusion
Colorado Springs offers a robust set of incentives for green and sustainable commercial construction, making it an attractive destination for developers committed to environmental stewardship. From expedited permitting and C-PACE financing at the local level to federal tax credits and utility rebates, there are numerous opportunities to offset the costs of building sustainably. Additionally, achieving green building certifications like LEED or WELL can enhance a property’s market appeal and provide long-term financial benefits. As sustainability continues to gain importance in the commercial real estate market, taking advantage of these incentives in Colorado Springs can lead to both environmental and economic success for developers and businesses alike.