03/ 28/ 2002
What small businesses are doing to battle rising energy prices and unreliable supply
By Ivan Sylvester
Soaring prices of natural gas, electricity, diesel and gasoline have hit small businesses hard. With the summer heat and sagging supplies forcing rolling blackouts, some small business owners are fighting back by taking control of their energy needs, through efforts large and small.
Take Steve Ahmann. The president of Pacific Power Batteries installed $25,000 in solar panels on his Marysville, Wash., battery store last August. His motivation was partly soaring energy costs, partly virtuous.
"We’re trying to set an example for other small businesses of what’s possible," Ahmann says. "This system works. If the power goes out, our business will still function, and that has some real value."
When originally installed, Ahmann calculated a 20-year payback on his eight solar panel investment. But as electricity rates have skyrocketed, he anticipates the system paying for itself in less than 12 years.
During power outages this spring, Ahmann was able to keep computers and phone lines at his 11-employee company operating—of special importance since much of his business is conducted online at www.pacificpowerbatteries.com.
Not every small business can afford such an investment. At Jill Lublin’s seven-employee public relations firm in Novato, Calif., conservation measures have been more along the Ebenezer Scrooge variety.
"We keep our lights off and turn off the computers every night," says Lublin, owner of Promising Promotion. "Our office has lots of windows for natural light, and doors which we open. We’re using fans to circulate the air, rather than air conditioning."
The effort, undertaken after a particularly high electricity bill in January, has cost Lublin and her staff nothing more than a bit of discomfort. The savings, though, are significant. Previous electricity bills of over $200 a month have been reduced about 60 percent.
“A lot of it has just been paying attention to what we use," says Lublin, whose business is at www.promisingpromotion.com.
At The New Willows restaurant in San Jose, Calif., owner Vic Baghdasarian cut his open hours by two to reduce use of his pizza ovens and all dirty dishes are consolidated to run through the washer once, instead of continually throughout the day.
About 20 percent of small business owners in California have been struck by blackouts this year, according to a survey by Mason-Dixon Polling and Research for NFIB. The poll also revealed that 31.2 percent of small business owners have a contingency plan in place to minimize a potential blackout.
Many analysts say smaller businesses are the hardest hit by rising energy prices because they don’t have the technology or capital of large corporations, and don’t have extensive management teams in place to implement energy-saving techniques.
Yet there are steps they can take. Lighting and heating/cooling are the two areas where little changes add up to the most savings, according to Eric Zausner, CEO of MyHomeKey.com.
“There are some quick and dirty tips a small business owner can do themselves or at a low cost, such as caulking windows, that can help,” says Zausner. His site features an online energy audit, which will show where your business is using the most energy and the potential for savings. MyHomeKey.com also includes a service network of 40,000 guaranteed technicians nationwide who can perform the energy conservation tasks.
Some solutions are as basic as replacing artificial light with natural light wherever you can. That’s the idea behind Solatube, http://www.solatube.com, a small business based in Vista, Calif., which makes tubular skylights. Last year the company installed Solatubes in its 48,000-square-foot headquarters, and has seen an 86 percent reduction in lighting costs for its offices, and a 68 percent reduction in lighting costs for its warehouse.
"The other key thing is we’re finding that health, safety and productivity benefit from the daylight," said Neall Digert, Solatube’s technical director. "So in addition to the energy savings, there’s a payback in increased productivity."
This is because a person working under a Solatube gets visual cues on the passage of time and what’s happening outside, even if they are removed from the windows in a building. "With the psychological connection to the outdoors, people will sit at their desks much longer," Digert said.
It costs about $1,000 to install a Solatube, which is cheaper than a traditional skylight because no dry walling, reframing or repainting are required.
For some small businesses, the current emphasis on energy conservation is frustrating, because they’ve been working at it for several years. Brian Lucas has continually improved the energy profile of his Adams Avenue Book Store’s 85-year-old building in San Diego since buying it 14 years ago. He’s installed double-paned windows, added insulation, fans, and a rebuilt door. Recent efforts have included switching to low energy lighting and minimizing use of heat and air conditioning. Yet none of that has prevented him from having to close his doors several times this year due to rolling blackouts. "From our point of view, there’s really nothing else we can do," Lucas says. "The calls to conserve hit us a bit hollow, because we’ve done everything."
Get out of the dark
Simple ways to reduce energy costs immediately
This article originally appeared in the July/August 2001issue of MyBusiness Magazine, NFIB's member magazine.
