June Giga-Thought: Better Policies Needed for our Growing Energy Economy
By Robert “Tate” Rust, Waterfurnace International, Territory Manager
Since the expiration of North Carolina’s Renewable Energy Investment Tax Credit (RE ITC) in 2015, many things have changed. South Carolina approved a tax incentive for any individual or business installing geothermal ground source heat pumps (GSHPs) and Virginia appears to be on their way to something similar. Now, the jobs and revenue that were encouraged by our RE ITC will start to move instead to states that have policies which promote installing clean energy technologies, such as GSHPs, to efficiently meet heating and cooling demands.
The economic downturn in 2008 caused many local businesses to either close or downsize. The HVAC and GSHP industry was no exception and soon followed suit. However, once incentives started to materialize for GSHPs, many businesses were able to stabilize and grow. This positive growth even started to make an impact on the drilling contractors who worked on wells for GSHPs. Since water wells have diminished, irrigation regulations put into place, and reductions in environmental drilling made, many larger companies considered reducing staff, but GSHPs provided the boost they were looking for.
One question I ponder: if we took the opportunity to feed this industry, how much more growth could we accomplish? The benefits to the Old North State could be huge!
It is a fact that GSHPs have many benefits, and not just to the individual or business that installs them. For starters, these technologies can provide a benefit to power generators like Duke Energy because they are advantageous during peak loads in both the heating and cooling seasons. The technology can also profit local governments and power producers with less strain on their infrastructure.
In the Southeast, homebuilders and developers are installing GSHPs and leasing them to homeowners. This helps to reduce the upfront cost and serve as a “positive cash flow”, all while providing reoccurring revenue to the installer. These types of projects are also being promoted by the states and the power producer in an effort to reduce the demand and size of conventional power plants and lessen the strain on their grid. The reason is not to impede growth, but to provide their customers with innovative ways to efficiently and effectively meet their needs. Sounds like a perfect fit for North Carolina.
Finally, the advantages to owners of these installations include comfort, reliability, and efficiency. It’s well known that energy efficiency is a least-cost, least-risk energy resource and GSHPs are the most energy efficient technology for satisfying thermal loads (heat loss and heat gain) of homes and buildings.
Knowing all of this, we should be concerned about where energy policies lay in North Carolina. There seems to be a push to confine the geothermal heat pump industry to more of a building performance product, even though these systems provide value to power producers, users, and providers. In North Carolina’s monopoly-controlled energy market, current policies are not encouraging GSHP adoption. Our decision-makers need to truly consider what is best for North Carolina and be more receptive when they hear the words “renewables” and “clean energy.” North Carolina is fortunate to have a talented, educated work force — one that would benefit from more productive clean energy policies. Are we willing to let jobs, businesses, and other investments leave North Carolina?
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