Dollars for Decarbonization: Top Six Funding Sources All Building Owners Should Know About

Decarbonization is a universal challenge for building owners to reduce emissions through energy efficiency, electrification and renewable energy. Here are six ways you can fund decarbonization efforts and grow value for your business.

1. Federal Funding

The Inflation Reduction Act of 2022 (IRA) provides up to a potential 70% tax credit for the installation of clean energy technology and storage, according to the Investment Tax Credit Section 48.

Additionally, Section 179D allows a tax deduction of up to $5 per ft² tax credit for costs related to energy efficiency and electrification projects in new and existing buildings. You may have also heard this referred to as the Energy-Efficiency Commercial Buildings Deduction or the 179D tax credit. To clarify, 179D is a tax deduction, not a credit.

2. Utility Incentives

Many utility companies are offering incentives and rebates to help pay for purchasing electric heating and cooling systems. Check with the utility company in your area for specific details. Then contact Trane experts to ensure you make the most of the opportunities.

3. Third-party Investors

Green investor strategies include Environmental, Social and Governance (ESG) funds, green bonds, various service models and private purchase financing.

4. Energy Cost Savings

Investing in modern, energy-efficient systems can put operational cost savings back into your budget. To learn how, read any of our Customer Stories – case studies of a wide range of organizations that have successfully partnered with Trane to decarbonize and increase savings.

5. Shareholder Value

Fighting against climate change by decarbonizing your building can make your business more attractive to investors. In 2022, a study by Capital Group showed that 89% of investors considered ESG issues when investing.

6. Brand Equity

Customers actively support brands that align with their values. Decarbonization can bolster your bottom line by increasing sales to customers that prioritize sustainability. Research reported by the Harvard Business Review shows that as younger generations increase their purchasing power, brands that are committed to sustainability and transparency will be more likely to win their business.

Share these points with your team today and contact the experts at Trane to learn which funding source(s) may work best for your organization.