Performance Contracting: Speeding Stimulus Dollars for Energy Programs into Local Economies February 23, 2009 Posted by: johnsoncontrols 05:10 AM By Joy Clarke-Holmes, Johnson Controls
And so begins what may well be the biggest economic experiment in history. The $780 billion stimulus package signed by President Obama last week is intended to jump-start our economic engine. Will it work? Ask me that question again in a few months, but in the meantime this much is crystal clear: the sooner the money is spent, the sooner we’ll feel the impact.
That’s certainly true for the billions of dollars going to local governments to fund energy efficiency and renewable energy projects. And I can tell you from personal experience there is no faster, more responsible way to get that money into the economy than performance contracting – a funding mechanism that’s been around for more than a decade and is currently available in virtually every state in the union.
Recently, I had the opportunity to talk about how performance contracting can help local governments capture their share of the stimulus spending when I participated in a green tech solutions town hall meeting sponsored by the National League of Cities. Check out the archived version here to find out what hundreds of other cities nationwide have already learned: performance contracting can help them cut their costs, support their sustainability goals and create green jobs for local workers.
Ingenuity That Walks the Talk February 16, 2009 Posted by: johnsoncontrols 12:53 PM By Jennifer Mattes, Johnson Controls
What do an inspirational movie, a weight loss program and a puppet named Butch who plays guitar and has a bossy sister all have in common? Ready for this? They’re just three of the more than 750,000 things you can find online if you Google the phrase “walk the talk.” Amazing.
No one really knows where that saying “walk the talk” came from, or even who is credited with being the first person to use it, but there does seem to be general agreement on what it means: “back up your words with your actions.”
Wherever the expression came from, the words “walk the talk” symbolize something very important to all of us at Johnson Controls this week – something that’s spelled out in black and white in our just-released 2008 business and sustainability report.
Called “A World of Ingenuity,” the report is a rather ingenious way of letting our customers, employees, investors and the public know how we performed on the triple bottom line: our financial, social and environmental accomplishments from the first day of October 2007 until the last day of September 2008. Happily, it’s a story of how we truly “walked the talk” during those twelve months.
From a strictly economic perspective:
It was another record year for sales and earnings
Our Building Efficiency business unit expanded energy efficiency capabilities, focused on renewable energy initiatives and introduced new products and services – all promoted through the Efficiency Now movement.
Power Solutions – already the world’s largest maker of automotive batteries – continued to increase market share and gain momentum in developing lithium-ion batteries for hybrid vehicles.
And Automotive Experience doubled its margins in the declining North American market, while continue to gain share in Europe and Asia.
On the environmental front:
Our products and services helped more than a million customers use less energy and shrink their carbon footprints.
We introduced lighter weight components for car interiors that are made from recyclable materials.
We reduced air emissions in our lead acid battery manufacturing process by 30%.
And we renewed our commitment to Climate Leaders – the EPA’s partnership program – by advancing our efforts to reduce our greenhouse gas emissions by 30% by 2012.
And from a social perspective:
For the second time, the National Minority Supplier Development Council named us Corporation of the Year for our supplier diversity initiatives.
At 530 of our locations around the globe, some 13,000 employees volunteered more than 110,000 hours of their own time to help make their communities better places to live and work.
We donated more than $12 million to non-profit and community organizations dedicated to the arts, the environment and social services.
Just as importantly, the format of the 2008 report demonstrates that we say what we mean and mean what we say. Available online at www.johnsoncontrols.com/bsr, the report is really engaging. Videos accompany the text to put names and faces on the stories of everyday heroes accomplishing real results. And it’s fully interactive: readers can browse by the words or topics that interest them most and build their own custom report that includes only the sections that they find most valuable.
The printed version is smaller to reduce waste during the printing process and is printed on 100% recycled paper. And while the online version will soon be available in a dozen different languages, the report will only be printed in English and a handful of Asian languages.
All in all, this year’s report is the clearest expression yet of how we’re delivering on our promise to help create a more comfortable, safe and sustainable world. For more than 140,000 of us at Johnson Controls, in more than 125 countries around the world, it’s how we walk the talk every day.
How Tax-exempt Organizations Can Still Benefit From Tax Breaks for Solar Energy February 09, 2009 Posted by: johnsoncontrols 04:13 AM By Derek Price, Johnson Controls, Inc.
Picture a large medical center in a major metropolitan area. An eight-story hospital dominates the center’s two-acre campus, which is also dotted with smaller clinics, office buildings and parking structures. Hundreds of doctors, nurses, administrators and other staff work around the clock to provide top-notch health care to people from all over the region – care that saves many lives, and makes many more worth living.
Now picture the center’s electric bill. It’s big, really big. And with energy prices that are always either rising or falling – sometimes quite dramatically and with little warning – it’s pretty hard for the facility manager to come up with a budget every year, much less stick to it.
Here’s a thought: with so many buildings, couldn’t the medical center generate its own electricity with solar panels spread out over all those empty rooftops? Wouldn’t that help stabilize the center’s electric bills, reduce its carbon footprint and send a strong message to the community that it’s a caring and responsible corporate citizen? Isn’t that an option?
The answer is yes, it is an option. But it’s not a very good one, and here’s why: Many of the financial incentives available to help offset the initial costs of installing a solar photovoltaic (PV) system come in the form of tax credits, or accelerated depreciation on the solar equipment itself. Those incentives are great for businesses that pay taxes. But the medical center is a non-profit organization, so it doesn’t pay taxes. That means it can’t benefit from the tax breaks. And that makes it much, much harder for the medical center to make going solar financially feasible.
Fortunately, there’s an easy solution: a Power Purchase Agreement, or PPA. A PPA is a contract – in this case, a contract between someone who owns a solar PV system and someone else who buys the electricity that system generates. Here’s how it could work for the medical center:
The medical center signs a PPA with a third party – typically an investor or group of investors
The medical center agrees to let the third party install solar panels (and related equipment) on its facilities
The medical center also agrees to buy all the electricity the solar panels generate – at fixed prices – for the life of the contract, which could be as long as 25 years
What’s in it for the medical center? Lots:
No up-front costs of purchasing and installing the solar panels –the third party puts up the money
No ongoing operating and maintenance expenses – likewise, the third party bears those costs
Stable electric rates for the life of the contract – eliminating the ups and downs in its electric bills and providing a hedge against dramatic increases in energy prices
The positive goodwill in the community that comes with doing the right thing
The third party investors are, of course, a commercial business, so they can benefit from the tax credits and other incentives that make these kinds of projects good investments. It’s a classic win-win – and it’s perfect for hospitals, schools, state and local governments and other non-profit organizations in states where a) electricity rates are relatively high and b) state tax credits are available.
If you’d like to learn more, check out our white paper on funding renewable energy projects.
A Finger in the Wind at the AHR Expo February 02, 2009 Posted by: johnsoncontrols 04:47 AM By Allen Martin, VP and General Manager – Systems, Johnson Controls, Inc.
Considering the way the economic breezes have been blowing lately, I wasn’t sure what to expect in the windy city of Chicago last week as those of us in the air conditioning, heating and refrigeration industry came together for the AHR Expo. But what I heard from the building contractors, engineers, facility managers and owners at the show was a breath of fresh air.
Are they concerned about the current economy? You bet – who isn’t? But they’re also more enthusiastic than ever before about greening their buildings. In the midst of the toughest business climate in decades, people in our industry still have their eyes on the ball: making our homes and buildings more energy efficient, reducing their impact on the environment, making them safer and more sustainable.
I think that’s why our booth was consistently crowded with people interested in knowing more about how we can work together to get there. Everything we featured at the Expo was about energy efficiency and sustainability. You can click here to check out the whole enchilada, but here are the highlights:
The new Series 10 commercial comfort system that uses R-410A refrigerant, so it meets EPA standards for 2010. Plus it boasts the highest energy efficiency ratings of anything in its class.
The 33-inch York Affinity gas furnace with its 98 percent Annual Fuel Utilization Efficiency (AFUE) rating – making it the industry’s most efficient gas furnace (and the winner of an AHR Innovation Award to sit alongside its 2008 Consumer Digest Best Buy Award).
Our Metasys® Sustainability Manager – the perfect marriage between our building automation systems and the monitoring software we acquired from Gridlogix. This combo brings together data from multiple systems, in multiple buildings to give facility managers unprecedented control over their energy use, help them spot trouble early and enable them to make adjustments in real time.
New Johnson Controls/PENN refrigeration controls that are our most reliable, flexible and efficient ever.
Oh, and did I mention a lot of people were also interested in saving money? One contractor told me the design of the York Affinity furnace would permit his crews to make installations in a lot less time – sending more dollars to his bottom line.
And I heard this great story about the durability of the Series 10 comfort system. Back in November, there was big hail storm in Oklahoma. Outside one commercial building, hail stones pounded two commercial HVAC units – one of them a Series 10 with its new micro-channel all-aluminum cooling fins. When the storm was over, you could see where the hail had slightly dented the fins on the Series 10, but they were otherwise intact and functioning. Not so with the other unit, where the old-style copper tubes were smashed and destroyed, requiring costly repairs.
One last thought about this year’s AHR Expo: I was encouraged by the attitudes of so many attendees. No question about it – these are tough times for all of us. But most of the people I talked with are very, very optimistic about the future.
The economy is certain to make a comeback – it’s just a matter of time. And when it does, there’s a widespread belief that it will be a strong recovery.
In the meantime, stimulus packages promise to pump new dollars into the economy. Let’s just hope that a big part of that new spending is focused where we all know it can work the fastest to create jobs and put us on the path to energy independence: Efficiency Now!
