Energy-efficiency spending to grow in 2010, survey finds.

	Apr 20, 2010	Milwaukee Journal Sentinel
	By Thomas Content MILWAUKEE, Apr. 20, 2010 (McClatchy-Tribune News Service delivered by Newstex) -- Spending on energy efficiency is projected to grow as the economy improves and businesses ramp up capital spending, according to the latest energy-efficiency snapshot from Johnson Controls Inc. (NYSE:JCI PRZ) (NYSE:JCI) The company surveyed more than 1,400 executives in North America about energy costs, carbon-mitigation plans and energy-efficiency spending trends for its annual Energy Efficiency Indicator, released Monday.The survey found that improving energy efficiency in buildings is by far the biggest priority for business owners and energy managers as a way to reduce carbon emissions. But other factors are also driving interest in energy efficiency, including projections of higher energy costs. On average, those surveyed say energy prices will rise 7 percent in 2010.The survey also found that even with no carbon mandates in place, 14 percent of those who responded work for companies that have rolled out public commitments to reduce their carbon footprint.Barriers to deploying more energy efficiency remain, however, both in access to capital as well as concern about the payback period, or return on investment, for funds invested in energy efficiency, the survey found."Energy efficiency is a high area of prioritization and focus," said Dave Myers, president of the building-efficiency business at Johnson Controls. "Even in a challenging economic year it remained a very high priority. Investment was stable, and in many cases there was an increase in investment."In a finding that surprised panelists during a webcast announcing the study's results, 32 percent of those who responded said they increased investment in energy efficiency in 2009, despite the tough economy.That could be in part because energy-efficiency upgrades are generally funded through internal capital and operating budgets, whereas access to outside capital has been difficult, Myers said.Peter Molinaro, vice president at Dow Chemical Co. (NYSE:DOW) , said the company has seen a payback through its commitment, launched in 1994, to reduce its energy intensity by 20 percent by 2005 _ and a new plan that would pare the company's energy intensity by another 25 percent by 2015. The company has invested $1 billion but has seen a $9 billion payback, he said.In its building-efficiency business, Johnson Controls has signaled that increased activity in the construction markets, coupled with increased attention to projects that save energy, could help improve its sales ."We sense that optimism," Myers said.At the same time, there's a "stalemate" around lack of resources to invest in energy efficiency, said Clay Nesler, vice president of global energy and sustainability at Johnson Controls."Organizations are perfectly willing and want to invest, but we also see in the research that they tend to rely on their own internal capital and operations budgets, so as those budgets get stressed, like in the past year, or when there are a lot of alternative uses for that capital, the energy investments are relatively underfunded."Some companies have set aside particular budgets aimed at energy savings and carbon mitigation, but most companies have not.One of the key areas of focus is to broaden access to low-cost capital to fund projects, including the Property Assessed Clean Energy bonds that are being implemented in various states around the country.Several communities in Wisconsin have been launched that would enable energy efficiency or solar energy projects to move forward with this type of funding, in which the upfront costs of energy-saving projects are financed and then paid back over time as a property tax assessment.Legislation pending in the state capital of Madison _ either included in the state global warming bill or separate from it _ would enable businesses to take advantage of this type of funding source, Nesler said.___ Newstex ID: KRTN-0025-44049940