Millions offered in energy incentives

DOWNEY - The more than $20 million in rebates and incentives being made available this year by Southern California Gas Co. to business owners that can present qualifying energy-efficient projects is sweet music to their ears. This is offset, however, by the mostly discordant notes produced by economist Jack Kyser's prognosis of the Southern California economy which is still definitely mired in a recession.This was the gist of the presentations Tuesday at The Gas Company's 4th annual Energy Efficiency Expo held at its Firestone Boulevard facility in which more than 300 business representatives took part. According to The Gas Company's senior vice president/regulatory and finance Lee Schaverien, rebates may be realized mostly from cash payments on "hundreds of pieces of qualifying equipment," incentives from cash payments attached to "flexible" energy-efficient programs that are not covered by rebates. The Gas Company offers help, usually free, "before, during, and after" a project. In its main outline, this is how the program works: when buying a piece of energy-efficient equipment, for instance, a business can reduce its purchase cost by a rebate or incentive from The Gas Company. A loan for the balance of the equipment cost can then be financed by The Gas Company, at zero percent interest: a private corporation can get a $100,000 loan, while a government agency can qualify for up to a $250,000 loan. "The first step to saving energy and money," says The Gas Company, "is knowing how your business uses energy." Energy efficiency assessments are free. The rebate program kicks in when a business replaces or upgrades equipment with energy-saving features. Examples are those relating to such items as food service equipment, gas coolants, water heaters and boilers. For major commercial/industrial building projects, incentives (not to mention tax incentives) kick in when sustainable building design, indoor air quality, energy modeling, and LEED certification features are involved. A panelist, Yusheng Xu, president of Tri J Heat Treating Co. in Pomona, narrated how he rearranged his work process to make better use of his most efficient furnaces, which The Gas Company identified during an on-site assessment. In his testimonial, Xu said, "I saved about $20,000 last year on energy costs and I didn't spend a dime to do it." A second panelist, Jeff Mueller of American Die Casting in Fontana, had this to say: "The Gas Company offered to help finance my new energy-efficient furnaces through a $50,000 loan with no interest, no points and no fees. It was a no-brainer." Jack Kyser, founding economist of the Kyser Center for Economic Research of the Los Angeles Economic Development Corporation and a frequent commentator on the economic scene, was meanwhile one of the guest speakers and he offered a no-punches-pulled assessment of the economic environment in which businesses will operate and residents will live for the foreseeable future. He said "lots of interesting things" will continue to happen, particularly in the job market and in the film industry. He sees lots of unemployment ahead-especially in retail, manufacturing, and construction, and most probably aerospace, although he notes some signs that retail may be bottoming out, while inventories are being used up, always a hopeful sign for manufacturing. "The situation in SAG (Screen Actors Guild) politics is one of the most poisonous I've seen," he said. People used to luxurious travel are suffering under the "AIG effect," while he predicted "a lot of turmoil" within the banking industry. Retirees have seen the value of their endowments shrink, he went on. There is, however, amidst all this gloom and doom, an upside: the rate of inflation may be easing a bit, housing permits have shown signs of stability and may even be at the start of an upswing ("Yes, you can afford to buy a house in Southern California now"), and opportunities are presenting themselves in potential new industries (in green, technology, 'creative', food service, furniture, even the arts). "Whoever comes up with solutions to the problems we face stand to make big money," he said. If and when the longed-for economic recovery comes, it will be a very muted one, Kyser said, maintaining that it could manifest itself at the end of the year, but most likely it will occur at the end of 2010. But for now, he said, "People are afraid." His suggestions to business: utilize available support services, keep costs under control, coddle your best customers, look for business opportunities, and otherwise "maintain a balanced view of the economy. This was before the votes were tallied on the six proposed state budget amendments (five were voted down), with all that this implies.

********** Published: May 22, 2009 - Volume 8 - Issue 5