The President today proposed an energy efficiency initiative for commercial buildings that would provide tax incentives for retrofits and efficiency upgrades. Basically this attaches a “BuildingStar” component to the HomeStar legislation which has sat in Congress for well over a year. The White House estimates this program would increase energy efficiency by 20% in the next ten years, and reduce energy bills by $40 billion a year. Basically it’s a tax incentive to retrofit, along with increasing financing and using competitive grants to municipalities to encourage them to upgrade.

This is the low-hanging fruit of the energy debate, and Obama wants to pay for it by slashing those oil company tax subsidies, which is a crowd-pleasing measure:

To offset the cost of the energy efficiency proposal, Obama called on Congress to eliminate oil industry tax breaks, comments that were met with loud applause by the crowd at Penn State.

“They are doing just fine on their own,” Obama said, echoing language he used in his State of the Union address last week. “So it’s time to stop subsidizing yesterday’s energy. It’s time to invest in tomorrow’s.”

There’s just no way that Republicans will agree to that. In fact, their own House rules disallow spending on new programs to be offset with tax increases, which is how they’ll characterize this elimination of tax expenditures.

Furthermore, while greening buildings is a laudable goal that should command broad support, even combined with what else the Obama Administration has achieved on greentech, it’s a drop in the bucket compared to the gap in green energy investment between the US and other countries. The smallness of this measure does not suggest that the Obama Administration seeks to win the future, but that they seek to lose it more slowly.

The bigger ideas that the green business community wants to see includes setting a market for green energy with a renewable electricity standard, making green energy tax credits permanent, or even instituting a carbon tax.

It’s not necessarily the Obama Administration’s fault that greentech companies see greener pastures where there is more demand for their product. But it is a major problem nonetheless, one that won’t be addressed by these small-ball efforts.