Research Project Summary Information
Brownfield Tax Credits: An Incentive for Siting CHP(ST9154-1)
Pace University Energy & Climate Center
Brownfield redevelopment presents an under-explored opportunity for combined heat and power (CHP) development in New York State. This project will educate project developers and CHP end-users about the existence of the Brownfield Cleanup program and the suite of tax credits it provides, use a screening tool to pro-actively search for potential CHP development projects on existing Brownfield sites, and develop and deliver a CHP outreach campaign responsive to the needs and concerns of developers and decision makers engaged in Brownfield site redevelopment.
Recently enacted State legislation provides a very significant suite of New York State tax credits aimed at Brownfield redevelopment. These financial incentives can encourage the use of CHP in redeveloping Brownfield properties in new and innovative ways. Nevertheless, anecdotal evidence suggests that the opportunity presented by the Brownfield redevelopment tax credit is not well known among the energy development community. Furthermore, developers interested in Brownfield redevelopment are unlikely to use energy efficiency or on-site generation as primary criteria for their investment decisions. As a result, there is a currently unmet opportunity to educate both energy and Brownfield stakeholders on the potential for profitable collaboration on CHP installations.
This project will promote the use of available tax credits to facilitate CHP development in Brownfield zones where CHP is most likely to succeed.
Through this project, Pace Energy Project (the Contractor) will lead a project team that will undertake a comprehensive and rigorous analysis of high probability targets for siting CHP at redeveloped Brownfield sites throughout New York State, coupled with a detailed education and outreach campaign intended to inform both CHP and Brownfield redevelopment stakeholders of the potential for high value on-site generation projects. The project will use a NYSERDA-developed GIS screening tool, the Geographic Location Assessment Tool (GLAT) to proactively identify Brownfield sites where there is a high-probability for cost-effective CHP installations. This tool will be supplemented with critical market intelligence provided by an Advisory Committee of Brownfield redevelopment, economic development, and CHP development experts.
Initial capital costs have often been cited as a barrier for end-users who may otherwise find CHP an economically attractive option. Because CHP is eligible for the Brownfield Redevelopment Tax Credit (BRTC) the capital cost of CHP installed on Brownfield sites can be offset, thereby reducing the acquisition price of clean onsite CHP. The BRTC Project cost savings could support installations in areas where CHP may be particularly beneficial: urban areas with air quality issues, industrial parks experiencing load growth, and new construction where thermal recovery can be integrated into building designs.
While all aspects of the project scope were completed, the outreach effort was disrupted by the change to the BRTC (tax credits)which made all the outreach materials developed in the project obsolete. The outreach materials all had to be redone and only recently became available. As a result of this project activity, a new outreach project has been funded by NYSERDA (#15912) that will be working with DEC and brownfield stakeholders to work through brownfield redevelopment issues that were identified in the first project. Very few redevelopment projects have actually been completed under the revised tax credits. Some of the reasons are differing interpretations of tax code compliance requirements, financing problems and uncertainties about the timing and scope of the regulatory review process.
Pace University Energy & Climate Center
235 Elm Road Tead House
Braircliff Manor, NY 10510
Energy Power Supply
NYSERDA Contact Information
R&D - Mfg Tech & On-Site Pwr