California Businesses Still Concerned with Energy Costs

Two-thirds of businesses in California have a negative feeling about deregulation, and 80 percent cite the cost of energy as a top concern, according to a recent survey.

SAN DIEGO, California, US, 2002-01-07 [SolarAccess.com] Since direct access was suspended by the California Public Utilities Commission in September, 77 percent of companies say energy efficiency is “very important” and many are actively seeking companies to develop potential energy-saving opportunities in diverse building types and locations, according to the poll conducted by Market Strategies of Detroit in late October. The companies are also seeking help from energy service providers to implement strategies that will allow them to capitalize on cost-control measures, energy-pricing opportunities and reduced market risk. The survey revealed that three-quarters of businesses are displeased with the end of direct access, which was allowed under the state’s original electric deregulation plan. Corporate and residential customers were allowed to purchase electricity from alternative energy service providers, often at a lower price. “It’s understandable that businesses are now struggling to cope with the re-regulation of the California electricity market and suspension of direct access,” explains Mark Camack of Market Strategies. “The survey shows that customers are exploring their options in energy-efficiency improvements as the principal way to control their energy costs.” The survey was commissioned by Sempra Energy Solutions, and involved energy management professionals in manufacturing, transportation, retail, education and healthcare industries. Respondents came from businesses with an annual electric bill of US$500,000. Due to renewed demand by California businesses for energy-efficiency services, Sempra has launched ‘Sempra PowerSave’ to combine traditional energy-efficiency analysis with a new understanding about potential energy savings. Officials say energy savings can be as high as 45 percent and that necessary changes can be identified within a two-week period. “Clearly, California customers know that controlling their energy consumption is critical to the bottom line,” says Bob Dickerman, president of Sempra Energy Solutions. “The survey demonstrates that, with companies now facing fixed market prices and no ability to secure their own commodity deals, they need to focus on making changes that reduce consumption — changes that pay off very rapidly.” Improvements with fast return include energy efficient lighting and efficiency motors on fans, pumps water chilling and heating pumps. “Executives responsible for energy management understand that the more precisely they can control and forecast power needs, the easier it is for them to save money,” adds Dickerman. “By implementing energy-efficiency programs today, companies will be better positioned to make the right decisions, when direct access returns to California.” Earlier this year, Sempra signed a 20-year agreement with Sherman Indian School in Riverside (California) to install a solar PV system and provide energy services, in a project that will save the high school at least $200,000 a year. It also formed an alliance with the Council of Energy Resources Tribes, an organization of 50 federally recognized American Indian Tribes, to provide energy efficiency, on-site generation and co-generation. Sempra Energy is based in San Diego and has annual revenues of $10 billion. It has eight subsidiaries, including Southern California Gas, San Diego Gas & Electric and Sempra Energy Solutions, with a total of 12,000 employees and nine million customers in the U.S., Europe, Canada, Mexico, South America and Asia.