By Dave Gatton
February 12, 2007

The construction of new homes and commercial building space will require an additional four quadrillion BTU of energy annually at an additional annual cost of $40 billion by 2031, according to the U.S. Conference of Mayors and its Council for the New American City. The total energy expenditures for these new buildings over the next 25 years will equal $500 billion, almost the same amount that consumers spend today on all forms of energy.

The projections were released by Conference President Trenton Mayor Douglas H. Palmer as a prelude to a major plenary session on Global Climate Protection at the Conference’s 75th Winter meeting.

“Energy issues, whether it is the cost of heating and cooling our homes or the cost at the pump, impact all of our constituents. And as mayors, many of us are feeling the impact or have seen the studies regarding what climate change will do to our communities,” Palmer told the over 270 mayors in attendance.

Findings of the report, “U.S. Metro Economies: Energy Costs and the Impact on U.S. Household Budgets” confirmed the mayors’ concerns. In 2004 the average household energy spending was $3,812. That figure jumped to $4,443 in 2005 and to $4,819 in 2006. Over the two-year period, total energy expenditures per household jumped a total of $1,638.

In 2005 consumer spending on energy was $502 billion. This was the first year consumer spending on energy surpassed half a trillion dollars and represents an 18 percent increase over 2004. In 2006 consumer energy spending is projected at $551 billion and $556 billion for 2007.

The report, prepared by Global Insight, Inc, found that the residential and commercial building sector accounts for 40 percent of total annual U.S. energy consumption—more than any other sector, including transportation. It concluded that the potential impact of a move to reduce our reliance on high-cost oil and gas supplies, largely from overseas, would be dramatic, and that just a ten percent reduction in energy demand for these new buildings would save $50 billion over the next 25 years.

The mayors unanimously adopted a resolution in June of 2006 at its Las Vegas meeting calling for all building to be carbon neutral by 2030—known as the 2030 Challenge.

To promote energy independence and to aggressively address global warming, the Mayors at this meeting called for creation of an Energy and Environmental Block Grant, modeled after the highly successful Community Development Block Grant program, to provide cities with the resources to develop and implement local energy efficiency, carbon reduction, and conservation strategies.

For a copy of the report and its key findings, go to the website usmayors.org.