NAHB urges incentives for green technology

Real Estate Weekly, May 7, 2008

Calling green building "the next evolution in residential construction," the National Association of Home Builders (NAHB) told Congress that the best way to help small home builders promote residential energy efficiency and sustainability technology in home construction is by extending tax incentives for new energy-efficient homes.

Testifying before the House Small Business Committee, Michael Hodgson, president of the Stockton, Calif.-based energy consulting firm ConSol, said these incentives dovetail with the normal supply and demand for home construction. "A tax credit program leaves important production decisions in the hands of builders, buyers and home owners and does not require expensive administrative oversight that is usually associated with a mandate," he said.

Under current law, builders who construct a home certified to achieve a 50% reduction in energy use are eligible to receive a $2,000 tax credit. That credit is set to expire at the end of this year, and although pending legislation in the House and Senate would extend it, there is still no agreement between the two chambers over the appropriate budgetary offsets. Hodgson also urged Congress to increase the dollar amount of the credit, because achieving the 50% threshold required by statute is costly, especially for small builders.