Cash incentives to go green

February 2, 2009: 6:34 PM ET

Environmentally friendly practices can help your business grow - and grants and low-interest loans are available to help.

John, Lynnwood, Wash.
"I'm looking to make my auto detail shop very green. Are there any government grants that I could get to convert everything to the greenest detail shop you've ever seen?"

By Kathleen Ryan O'Connor, CNNMoney.com contributing writer

Saving energy and reducing waste can have a powerful impact on any small business — auto detailing included.

But it can be expensive and difficult to convert to an all-green operation. Recognizing this, organizations and agencies ranging from your local utility to the federal government now offer a variety of incentives that can help, in the form of grants, loans or rebates.

Your local utility is the perfect first step. A quick check on the Web site of the Snohomish County Public Utility District No. 1 shows several rebate programs to help local businesses to become more energy efficient.

One, for energy-efficient lighting projects, will rebate 70% of the cost, or 100% of the materials cost if the project is self-installed, up to $7,500.

Another great place to look is the Database of State Incentives for Renewables & Efficiency, which has more than 100 listings for green grants, rebates and loans for Washington state alone.

Also check Business.gov, a Web site managed as a partnership by 22 federal agencies, for "green" business incentives. But as always, beware of grants that ask for money upfront and those that simply seem too good to be true.

You will also want to contact your local government-sponsored Small Business Development Center, a great resource for information to help your small business go green. Late last year, the Small Business Administration funneled $500,000 through business development centers in Idaho, Nebraska, Nevada and New York to help fund energy efficiency projects. Your local center might have similar options available.

The Washington state SBDC can be reached via Washington State University in Spokane.

Pamela Evans, the green business coordinator for Alameda County, Calif., helps businesses in her state adopt greener practices. Her program certified its first business in 1997 and now boasts 350 local "green businesses" and a waiting list of companies waiting to be considered for certification.

Even without a formal auditing or certification process in your area, small business owners can easily cast a critical eye themselves, she says. Look at your energy use, water use and waste volume. Few business owners realize that lighting can be as much as a third of their energy use, so it pays to go as energy-efficient as possible.

And it sounds obvious, but make sure you are in compliance with all existing environmental laws, Evans says.

"Say, for example, you are washing cars," she says. "Most local governments will have regulations to prevent runoff into a creek."

Thomas Rennie, founder and owner of AutoBella, a green auto detailing business in Portland, recommends starting with the front office.

"We just decided, me and my wife, to start treating our business like our home," Rennie says.

They began ordering liquid products that come in corn-based, eco-friendly containers that compost easily. They replaced old, energy inefficient lighting and took advantage of an option to buy wind-based power from their local utility. Even the pens they use got an eco-friendly makeover — they are made from cardboard and wood. Today, AutoBella workers wear shirts made from bamboo fiber, an easily renewable resource.

They've since moved on to bigger-ticket items, including a major investment in a $15,000 water reclamation system.

"It's expensive, but I'm getting a huge amount of business off of it," Rennie says.

He and his wife also committed to using biofuel instead of kerosene, a fix that illustrates how inexpensive some green moves can be. Switching to biofuel cost just $30, Rennie says, for a parts change on their high-pressure washer.

Just one warning, if you're on a diet: "It smells like french fries all the time," Rennie says with a laugh.

Give us your advice: Check out recent "Ask & Answer" questions.

Related links:

How can I cash in on clean energy?

Harnessing solar energy in Senegal

Investing in a green work environment

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