The stimulus package for Maine will result in a major investment in roads and bridges, clean water, energy and education. While the actual amount of money that will come to Maine is still being sorted out, we know that this is a transformative moment, an opportunity to build our future in a way that creates sustainable jobs and industries in our state.
Maine could receive more than $1 billion from the federal stimulus package and we must be careful not to use up all of these funds bridging existing budget gaps rather than investing in our future.
Maine has the highest proportion of oil-heated homes in the nation; 80 percent of our housing stock is dependent upon oil for heat and hot water. With our consumption of heating oil and with the need to drive large distances between population centers, Maine residents are overly reliant on foreign oil. If oil were cheap and plentiful and the carbon dioxide deposited into the atmosphere had no ill effects on the environment, this might not be a problem. But reality is that oil prices are extremely volatile, all of the money used to buy oil leaves the state, and we are destroying the environment that is the calling card of Vacationland.
Each year, $1.6 billion is spent heating Maine’s 440,000 homes. Seventy-six percent of this money is leaving the state. Imagine if Maine was energy independent. If we could capture that 76 percent — $1.2 billion — the economic effect of that recaptured money ($3.6 billion per year with a conservative multiplier) could generate gigantic tax revenue ($400 million per year) and economic activity for Maine.
We need to formulate a long-term comprehensive energy plan for the state that should include all aspects of viable and commercially sustainable renewable energy technologies.
My company, Maine Energy Systems, along with many other companies and research institutions in Maine, is investing in technologies and fuels to convert home and business heating systems in Maine from fossils fuels to renewable resources.
Whether we succeed or not will depend in great part on the will of the people. The conversion to renewable resources will cut heating costs in homes and businesses by more than half in the long term. By offering less expensive carbon neutral sources of heat energy, we can help move Maine off its addiction to foreign oil and toward energy independence.
In these difficult economic times, many Mainers are not in a position to install new central heating systems in their homes. One way for this to work would be for the state to offer incentives to encourage efficiency and to help consumers make the investment. The tax revenues generated from this type of economic activity could over time more than pay for the state’s initial investment.
From my specific perspective, the following steps can be taken by the state regarding incentivizing the conversion of energy for heating homes and businesses from fossil fuels to heat energy derived from renewable resources:
ä Direct homeowner subsidies for wind, wood and wood biomass, thermal solar and geothermal heat for conversion of central heating systems away from No. 2 heating oil. The state should be prepared to direct as much as $100 million to this effort in order to subsidize 30 percent (up to $6,000) of the cost of conversion to a renewable central heating system to eliminate the need for No. 2 heating oil.
ä The subsidy program should not be income-based and should be available to all Maine residents. For low-income homeowners, there should be state guaranteed loans to provide for the remaining 70 percent of the cost of the central heating system conversion.
ä Energy efficiency, conservation and weatherization programs must be strengthened.
ä Rules and legislation that impede the installation of alternative-energy central heating systems need to be revamped.
ä A commitment from the state to convert state buildings to alternative heating and energy uses is needed.
These incentives can have an immediate and dramatic impact on Maine. For instance, focusing only on the use of proven technologies for home and business central heating systems that use refined wood-pellet fuel, Maine can create almost 10,000 jobs in Maine if only 10 percent of the homes and businesses that currently use heating oil convert to these clean, efficient and reliable systems.
Maine needs to warm from within. The wind is blowing. The trees are growing. The sun is shining. And the core of the earth is warm. The future of energy consumption in Maine can start changing today. It is up to us.
Les Otten serves as chairman of the Maine Pellet Fuels Association and is president of Maine Energy Systems in Bethel. He was formerly chairman of the governor’s Wood-To-Energy Initiative Task Force and vice chairman of the Boston Red Sox.