Minnesota Power spent about $1.3 million last year to help about 500 commercial and industrial customers become more energy efficient. Tim Gallagher, a program specialist for the Duluth-based utility company, expects to repeat that in 2008.
Jack Seiler, co-owner of Security Jewelers, was unaware of the incentive program until this year, when he invested about $8,000 in new high-efficiency lighting for his store. Minnesota Power picked up $3,380 of that tab through its PowerGrant program.
Since the changeover about three months ago, Seiler has seen the electric bill for his Duluth jewelry shop cut to about two-thirds of what it used to be. Seiler expects to recoup his initial investment in new lighting within 18 months, then pocket any additional savings.
Before receiving an energy audit, courtesy of Minnesota Power, Seiler had rebuffed suggestions that he replace the shop's incandescent lighting with fluorescents.
"I thought: I needed new light bulbs like a third ear," he said.
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But when Seiler sat down to look at cost projections after the energy audit, the numbers presented a compelling case.
"I'm not looking to save the world," Seiler said. "But if something saves me money, I'm interested."
Still, Seiler had concerns about the aesthetics of switching to fluorescent lighting. Jewelry shops need high-quality lighting to help customers fully appreciate the qualities of offerings such as gemstones, he explained.
But he found that the latest generation of fluorescents can produce warm, inviting light.
In addition to consuming less energy, fluorescents produce less heat. That's a big plus, as the jewelry shop runs air conditioning throughout the year because its steam heating system is difficult to regulate.
The PowerGrant program has benefited larger industrial customers, as well.
BendTec Inc., a Duluth company that bends and fabricates large sections of steel pipe, received $55,539 to help tackle a number of energy-saving initiatives, including the purchase of a band saw to replace old inefficient cutting torches, new welding equipment and upgraded shop lighting. The improvements have trimmed more than $51,000 from the company's annual electric bill.
Bob Meierhoff, BendTec's president, said PowerGrant has helped his company control energy costs. Eight recently purchased welding machines at BendTec are 20 percent more efficient than the equipment they replaced, and the plant's new fixtures consume less electricity and provide better lighting, making for a safer work setting.
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"Our labor costs are generally higher than what our competitors in the Gulf Coast pay. But our power costs are lower. So, that's one factor that helps us," Meierhoff said.
BendTec operates round-the-clock with three daily shifts and employs 150 people.
SMDC Health System has received repeated assistance through the program, using it to retrofit its facilities with more efficient lighting and mechanical systems. The health-care provider received a $45,000 grant that was used to help design its First Street clinic and cancer center, which opened in 2006.
John Rice, SMDC's director of plant operations and maintenance, said involving energy consultants at the front end of the project led to a more efficient design for the building. Some of those features include:
* "Daylighting" sensors that phase in artificial lighting only as natural light from the facility's many windows fades.
* Sensors that turn lights on or off on the basis of activity in certain parts of the facility.
* A high-efficiency cooling system.
* The latest state-of-the-art boilers.
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Rice estimates that SMDC has received $200,000 to $250,000 in PowerGrant funding in the past decade. It continues to be a useful tool, he said.
Gallagher said Minnesota Power has well-established relationships with some of its larger customers who have repeatedly used PowerGrants. But he sees room for improvement reaching out to many smaller customers, such as Security Jewelers.
"Small businesses seem to be the hardest to reach," he said.
PETER PASSI covers business and development. He can be reached weekdays at (218) 279-5526 or by e-mail at ppassi@duluthnews.com .
