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News Article
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Leviton saves energy, makes money
By Robert Gray
Leviton Manufacturing, a company that makes wiring devices, electric switches and outlets in El Paso, has slashed its energy bill and will be paid almost $54,000 by El Paso Electric for doing it.
“This was one of the easiest capital expenditures I have had to push through,” said Gerard Fasano, Leviton’s El Paso vice president.
According to El Paso Electric, Leviton is one of several companies that has taken advantage of programs that reduce demand for electricity in the region.
After enrolling last April, on Earth Day appropriately enough, and implementing several energy saving measures, Leviton says it has cut its annual power bill by about 15 percent.
That’s a savings of about $137,000 a year at its 100,000-square-foot facility on the Westside.
“We knew there were opportunities and we started to do some things on our own, but we didn’t have any kind of driving force. We kept getting interrupted. You know, production always gets in the way,” Fasano said.
“But when we have help and a partner it makes it easier because it helps us to stay focused.”
The company invested about $50,000 in upgrades to its plant. John Christie, facilities maintenance manager for Leviton, said they expect to pay off that investment in a few months.
Using less
Utilities like El Paso Electric face a bizarre situation: They have to convince their customers to use less of their product, in an effort to tame energy costs and reduce carbon emissions.
“Ultimately we will drive down demand and lower electricity costs across Texas,” said Terry Hadley, spokesperson for the Public Utility Commission of Texas.
PUC regulations aimed at reducing demand for energy in Texas have been applied to El Paso Electric (NYSE: EE) as it emerges from bankruptcy and seeks a rate increase. The utility hasn’t filed a rate case since 1995 because of two negotiated rate freezes that stemmed from its bankruptcy in the early 1990s.
The energy efficiency rule, created by the Texas Legislature in 1999, requires utilities to reduce growth in energy demand by 20 percent every year, according to the Public Utility Commission.
El Paso Electric met the standards for the first time in 2009, after three years of aggressive program development, according to Paul Royalty, manager of energy efficiency and utilization at El Paso Electric.
While the utility has 11 programs aimed at motivating its customers to use less electricity, companies like Leviton are reaping benefits from its latest effort.
The commercial solutions pilot program offers larger companies free consulting to help them identify where they can save energy, as well as a cash incentive.
In this case, larger means companies with a peak load of 100 kilowatts or an aggregate load bigger than 250 kilowatts of peak demand. El Paso Electric will pay the company $250 for every reduced peak kilowatt.
The reduction will also cut carbon dioxide emissions by about 3.3-million pounds, according to El Paso Electric. That’s the equivalent of taking almost 300 cars off the road for a year.
Better lighting
To reduce its energy consumption, Leviton installed sensors to turn off hallway lighting when no one is present, painted the roof with a white coating to reflect the sun and changed virtually all its lighting from incandescent to fluorescent.
Christie said the change in lighting not only saved them a significant amount of energy but also improved the quality of the lighting on the floor of its manufacturing facility.
“It is so much better on our eyes, it’s just a better environment to work in,” he said, adding that the new bulbs last longer.
The company also installed ductwork to distribute air from its hottest machines throughout the building to help with heating in winter.
But, Christie says, their greatest energy savings came from a system that turns their nine massive air compressors on and off based on demand. About 75 percent of their machines run using compressed air. The compressors ran continuously before they installed the new system.
Since the compressors are now being used less, it also extends their life, Christie said.
El Paso Electric, he said, “needs to get its checkbook ready for next year. We are going full blast.”
The PUC allows utilities to pass the cost of the programs to its ratepayers in the form of an energy efficiency rider.
According to testimony supplied with the rate case by Evan Evans, an assistant vice president at El Paso Electric, that will amount to 0.00105 cents per kilowatt-hour, or about 63 cents per month for a typical household.
In its recent rate case filing, El Paso Electric requests that it recover the costs of the programs, which will total $3.1 million by the end of this year.
While the cost of the programs will get passed down to ratepayers, Royalty says that consumers and the utility’s bottom line win in the end.
“If we can reduce the amount of peak demand, we can postpone investing in a generating facility. If we have to build one, that cost gets passed down through rates,” he said.
El Paso Electric is on track, he said, to exceed the PUC requirements this year; a good thing given that Hadley, PUC spokesperson, says that the commission is exploring another rule that would increase the requirement from 20 percent to 30 percent. The earliest the rule could be put into affect Hadley said is in 2011.
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