In conjunction with his administration’s Better Buildings Initiative announced on Feb. 3, 2011, President Obama has committed 1.6 billion square feet and $2 billion in financing support for building energy upgrades. The Better Buildings Initiative set a national target of improving the energy efficiency of commercial buildings by 20 percent by 2020.

On Dec. 2, the president announced that 60 CEOs, universities, hospitals, financial institutions, cities, and states have committed to upgrading a total of 1.6 billion square feet of commercial and industrial property under the initiative’s Better Buildings Challenge. The challenge is spearheaded by former President Bill Clinton’s William J. Clinton Foundation, the Clinton Global Initiative, and the Clinton Climate Initiative, as well as President Obama’s Council on Jobs and Competitiveness. In pledging to participate in the challenge, companies and institutions committed to investing nearly $2 billion of private capital to meet the Better Buildings Initiative energy-reduction targets. This represents growth from June 2011, when the initial 14 partners pledged to make energy upgrades to 300 million square feet and invest $500 million in private-sector financing for energy-efficiency projects as part of the Clinton Global Initiative America meeting.

In addition, on Dec. 2, President Obama signed a presidential memorandum directing all federal agencies to enter into a minimum of $2 billion in performance-based contracts for energy retrofits on federal buildings over the next two years. The memorandum calls for implementing existing federal authority to use energy-saving performance contracts (ESPCs) to promote energy efficiency. Under the ESPC program, energy-efficient equipment is installed at federal facilities for no up-front cost to the government. The cost of improvements is paid for over time by the energy costs that will be saved on utility bills, and all of the private-sector contractors used are required to guarantee the energy savings.