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Business and Economy

Maine Businesses Bracing for Steep Energy Price Hikes in New Year

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Tom Porter
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MPBN

In early October, state energy officials issued a warning to Maine businesses:  Be prepared for an unprecedented spike in electricity prices come the New Year.

Energy bills for mid-sized businesses using the standard offer rate could increase by 50 percent or more as the cost of electricity more than doubles for those customers.

The reason: natural gas pipeline constraints caused by increased regional demand during cold weather. With January now only days away, businesses are getting ready for what could be a tough winter.

Electrical contractors are busy installing a new a lighting system in a residential building at St. Joseph's College in Standish, one of nearly 4,000 high-use lighting fixtures being replaced across the 430-acre campus over the next year.
 

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Credit Tom Porter / MPBN
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MPBN
Mike Ward, right, is an electrician on the facilities staff at St. Joseph's College.

Electrician Mike Ward is on the facilities staff at the private college. "Currently, we change approximately 2,200 to 2,300 light bulbs a year," he says. Which takes up a lot of time. In fact, he says one electrician spends about half his time just changing ligh bulbs. But all that is starting to change.

"We're taking out fluorescent fixtures, which we change the light bulbs probably once almost every other year, we're changing them to an LED fixture with a life expectancy of 32 years," Ward says.

As well as lasting longer, LEDs - or "light emitting diodes" - use significantly less energy than regular light bulbs. Chief Financial Officer Yvonne Berry says the project began a couple of months ago, and she expects the impact to be significant when it's completed next winter and all the fixtures have been replaced.
 

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Credit Tom Porter / MPBN
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MPBN
St. Joseph College Chief Financial Officer Yvonne Berry.

"We're expecting to reduce our kilowatt usage by about 900,000 kilowatt hours every year," Berry says, "to reduce our carbon, our CO2 emissions by about 500 tons a year."

All of which should add up to projected annual cost savings of about $100,000.

"Colleges are under an enormous amount of pressure to keep their tuitions low, and St. Joseph's is no exception," Berry says. "And with these savings we are able to contain our cost. It just makes good business sense."

Our preliminary results shows that investment in energy-efficient equipment is double what it was a year ago," says Michael Stoddard, executive director of Efficiency Maine, a statewide program funded by electricity consumers that promotes energy conservation by offering rebates and other incentives.

In the case of St. Joseph's College, Efficiency Maine is providing a quarter of a million dollars in grant money towards the $650,000 light replacement project.

"We are seeing twice as much demand for our programs this year, and I think that's a very good sign that we have succeeded in getting the word out to business owners that higher electricity prices are coming," Stoddard says, "and investing in energy-efficient equipment is the smartest way to mitigate the impact of those prices."

Stoddard says Efficiency Maine has, in the last couple of months, increased the range of energy-saving qualified products that are eligible for a rebate, to help commercial users prepare for next month's expected price increases.

More than 1,000 businesses across the state are now enrolled in efficiency projects, and Stoddard says he wants to see that number grow. Pipeline constraints are expected to impact winter energy prices for at least two more winters, he says, so the sooner businesses start investing more in efficiency, the sooner they can start saving money.