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May 10, 2004

Power down | Small businesses get cash back for energy-efficient equipment purchases

By James Wright

Daniel Parsons, president and CEO of AC Electric in Bangor and Auburn, recently bought a new air compressor from Trask-Decrow Machinery in South Portland. Like AC Electric, which rebuilds electric motors and generators and repairs power distribution equipment, industries large and small ˆ— hospitals, auto garages, lumber mills, power plants and even screen printers and embroiderers ˆ— depend on air compressors.

However, the cost of operating these machines is high if they're run at a fixed speed. Now, customers like Parsons who purchase a new variable-speed air compressor that saves thousands each year in energy costs are also eligible for sizeable rebates from the state government.

In total, AC Electric will save about $15,000 annually with the new equipment, which Parsons purchased with the help of an almost $10,000 rebate from Efficiency Maine ˆ— a statewide action group funded by the state's electricity consumers and charged with promoting and facilitating more efficient use of electricity, reducing energy costs and improving the state's environment. One way it does so is through its Small Business Program, which offers cash rebates and incentives to businesses that invest in energy-efficient equipment. Since the rebate program began a year ago, Efficiency Maine has doled out more than $245,000 in incentives to 220 small businesses in Maine.

Linda Viens, the Small Business Program manager at Efficiency Maine, believes that small businesses in Maine can save money "every time they turn the lights on." Choosing cost-effective options for energy usage should become standard practice throughout the state, she said, and Efficiency Maine is making its greatest strides toward achieving that goal through companies like Trask-Decrow, which serve as "program allies." Trask-Decrow, which for 10 years participated in energy-saving rebate programs in conjunction with Central Maine Power, is one of 150 contractors, engineers and other industrial service firms that are knowledgeable about the program and equipped to sell and install qualifying energy-efficient products like compact fluorescent light bulbs, LED traffic lights and motion-detecting power switches.

Spreading the word of these new products and services makes a lot of sense to Greg Scott, Trask-Decrow's sales manager. "If you want to give your customers an advantage in their marketplace, [telling them about Efficiency Maine] is just a matter of customer service," he said. Scott readily admits that the upgraded equipment costs more, but he assures his customers it will save them money in the long run by using far less energy.

Using Efficiency Maine as a selling point, he said, "benefits us in that we sell a piece of equipment that we might not ordinarily sell because there's an incentive to purchase it. Then we facilitate the rebate process ˆ— that's our role."

Parsons of AC Electric said Efficiency Maine is much more straightforward than past rebate offers that have reached his desk. AC Electric just never seemed to qualify for rebates in the past, he said, because his company was either too large or too small, or because of special sales deadlines that were difficult to meet.

Efficiency Maine was "much more generous and easier to use," Parsons said, and a rebate just under $10,000 for buying equipment that will save him thousands in energy costs was simply "icing on the cake."

Reaching out to small business
Cash rebates, obviously, are the driving force behind Efficiency Maine, which was created in 2002 by the state Legislature's Utilities and Energy Committee and implemented a year ago. Administered by the Maine Public Utilities Commission, Efficiency Maine hopes to give out $400,000 in incentives this year to small businesses, which it defines as having 50 or fewer full-time employees, in and outside of the state. The rebate program is currently reserved for small businesses, but as of July 1 Efficiency Maine will lose its pilot program status, and will expand by launching a new Commercial and Industrial program for larger corporations.

Municipalities, nonprofit organizations and schools also are eligible for savings. For instance, two high schools, Catherine McAuley in Portland and John Bapst in Bangor, now use a new device on their vending machines that saves energy by "sensing" customers, in the manner of motion detectors commonly used in homes for porch lighting. The device, called VendingMiser, cuts energy costs nearly in half for the vending machines, which normally run 24 hours a day.

But Scott points to the success of his small business customers as testimony for Efficiency Maine. Parker Lumber in Bradford received a rebate of $3,857.76, and will save an estimated $7,262 annually (48,000 kilowatt hours) in energy costs by switching to an energy-efficient air compressor, which operates air cylinders on automatic equipment, cleaning equipment and air tools that perform essential and often costly maintenance. "We are the engineering firm and the equipment supplier, and the promoter of the program as well because it helps our business," Scott said. "We provide the technical justification. We measure the air flow, and the power consumption of the existing equipment and then we will predict what the power consumption will be at those same conditions" using the upgraded equipment.

The challenge now for Viens and Efficiency Maine is informing all the small businesses across the state about the program and the savings it offers. Their literature has been sent to businesses through the mail and distributed in person, representatives have attended restaurant trade shows and other similar events, and training has been provided to program allies who actually pitch the sale of energy-efficient equipment to the customer. It has been important, Viens said, not to flood the small business community with numbers and figures, but still to reach out to them. In addition, the relationship between the program allies and the state-run program "brings the credibility of an outside entity," said Viens, which is a key factor in individual businesses' decision to use the program.

As, of course, are the rebates, which "are as little as $30, as much as $20,000 and everything in between," explained Viens, who says there is a total of approximately $1.7 million available to small businesses, representing about 20% of the overall funds in the rebate program. Another 20% is available to low-income residents, and the remaining 60% for other residential customers. The funds for all of Efficiency Maine's programs come directly from consumers' electric bills.

"It's not our money and we respect that," Viens said. "We're striving to use Maine businesses [as program allies] the best way we can, and keep money in their pockets."

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