I live in Michigan with my family. We have owned our own construction business for over 10 years now, but with the economy we have watched everything we built slip away and like many others, we now find ourselves at a crossroad that we cannot deny. Either we try to wait for better days, or we change course to something new. We have chosen alternative energy. But after trying to weather the economic storm, we find ourselves in a place to only have one shot to financially make the right choice. The big question is which is the smartest direction to take in starting a alternative energy business in the future. If your son or daughter asked you for advice in this matter what would you tell them? Thank you for your valuable time. — Christine, T., Mancelona. MI
In this harsh economic meltdown, literally hundreds of thousands of small businesses are being pushed to the edge. My heart goes out to you. Energy prices, primarily gasoline and in some cases natural gas, are also going down in response to less demand due to this worldwide recession. And lack of credit for businesses and consumers also tamper demand to those interested in reducing energy costs, lowering emissions and being technology leaders. So I am not surprised about the gloomy outlook for the alternative energy market.
But, electricity prices are not lowering and in some cases still going up. State and local government incentive programs are still active, you can log onto www.dsireusa.org to find what incentives are offered. Because the economy is so bad, tax credits and tax exemptions may have less influence on market decisions because many businesses and individuals will not have large tax liabilities they are trying to offset, which made clean energy investments attractive.
So I would begin to focus my business to sectors receiving grants. In Michigan, I see these State Grant Programs: Biomass Energy Program Grants, Community Energy Project Grants, Energy Efficiency Grants, and Large-Scale Photovoltaic Demonstration Project Grants, and one Utility Rebate Program Wisconsin Public Power, Inc. – Renewable Energy Rebate. These areas would deserve attention because grants bring in dollars directly for the consumer.
The energy efficiency market is underserved. Whether it’s buildings — insulation, double and triple-pane windows with low-e coatings, sealing ducts, smart energy controls, solar daylighting and water heating, pv attic vent fans and ground-coupled heat pumps, as well as water-saving technologies — all have immediate payback for the customer.
There is also industrial efficiency including smart controls, the aforementioned building efficiency applications, transpired solar and solar-driven radiant and air space heating, as well as extremely efficient motors, manufacturing controls, waste heat or combined heat and power systems and the host of on-site renewable energy distributed generation all make economic sense. States such as Michigan, are focusing on making their existing industries more competitive and the incoming Obama administration is expected to pump even more money into reviving our traditional industries as they emphasize growth in the green industries.
Finally, both the federal government and state and local governments have set goals for energy efficiency and renewables in their buildings and facilities, which include both renovations and new construction. I would contact the appropriate web sites for both federal, state and local governments to get onto their RFP announcement lists, so you can bid on projects. Governments are good clients because they have funds and will pay.
Teaming up with companies that have previously won construction and renovation contracts is a good tactic if they have performed well in prior instances. I have participated in many teamed procurements where I bring in my specific expertise and rely on others for their areas of expertise.
The economic downturn will get better, and as the economy gets better, demand for energy will increase and energy prices will again rise. I’ve been through this seesaw several times in my life. Whether you cycle in or out of the clean energy industries or stick through the ups and downs of this industry, the future still looks solid for the green alternative energy industries.
Best of luck,