Emcor CEO: Stimulus Needs Green Tax Credits
Date: 08-Jan-09
Country: US
Author: Nick Carey
CHICAGO - The proposed economic stimulus package of President-elect Barack Obama should focus more on the private sector and provide tax credits for the green retrofitting of buildings, the top executive of construction and engineering firm Emcor Group Inc said on Tuesday.
"The stimulus package will provide a significant boost for the construction industry," Chief Executive Frank MacInnis told Reuters in a telephone interview. "But it cannot be successfully implemented if the money is just given to governments at all levels."
"I would strongly advocate tax reductions and tax credits for the retrofitting of private-sector buildings for energy efficiency," he added.
Obama has called for the retrofitting of buildings in the United States to lower costs and reduce America's dependence on other countries for fuel.
"If the stimulus includes tax credits then I am sure we will see immediate benefits," MacInnis said. "It would be much easier to persuade private-sector customers to invest in retrofitting if their investment paid off in two to three years instead of four to five years."
He said that Emcor products such as variable speed motors for air conditioning systems or modern electrical systems to provide lighting could be used to retrofit private-sector buildings.
MacInnis said if the stimulus is left just in the hands of local governments, he fears it will not have the desired effect of kick starting the sagging U.S. economy.
"If this is left just to the public sector then there is a greater risk of inefficient or short-sighted spending," MacInnis said. "That would do no more than reward the cronies of the politicians handing out the funds."
The CEO of the Norwalk, Connecticut-based company said he expects the stimulus will roll out in several phases. The first phase will focus on easy, short-term projects such as highway maintenance to get funds flowing and start creating jobs, with more complex projects that require more planning and advanced systems coming later on.
Because much of Emcor's business is based on more advanced systems -- such as retrofitting water treatment facilities -- MacInnis said the company would benefit more in the medium- and long-term from the stimulus package.
He added that energy efficient or environmentally friendly projects would not be seen until the later phases of the stimulus plan.
"Green projects tend to rely on more advanced technology so it will take some time and investment before we see them," MacInnis said. "I think the green constituency of the Democratic party will not be the primary beneficiaries of the early stages of the stimulus."
"They will have to wait some time before they see any benefits," he added.
(Editing by Tim Dobbyn)
