Businesses Sweat Out Power Crisis


In the rush to save kilowatts, here is what it has come down to for one of California's small businesses: ketchup stains are detectable under energy-efficient fluorescent bulbs but butter smears are not.

That's what the owners of Unique Cleaners in Ventura found before switching to a specially installed light bank that saves energy but still casts enough light to find spots.

Susan and Suk Cho then passed the information along to other cleaners, joining an informal and growing network of small-business owners who are sharing ways to sweat out a summer of predicted rolling blackouts and spiraling electricity prices.

Unable to tap options available to bigger firms, small, energy-sucking cleaners, ice shops, bakeries, restaurants and the like are turning to each other for help.

"I'm sure we will be sweating more, working harder and getting less accomplished," said Ken Ackerman, owner of ABC Ice House in Laguna Niguel, who plans to shut off his air conditioner. "Whether we will end up better off doesn't look likely."

They are getting a boost from the National Federation of Independent Business, which is setting up councils around the state to come up with conservation solutions for small-business owners.

"Small businesses are operating on very narrow margins," said Martyn Hopper, state director of the agency. "Energy is a bottom-line cost that affects their ability to pay salaries and benefits and their ability to exist. So anything they can do to shave costs will help."

Projections of 30-plus days of summer blackouts could cost California businesses an estimated $21.8 billion, a study by a California business consortium found. Paired with electricity rate hikes of about 35% for small-business customers, merchants have been forced to think hard about ways to conserve and prepare for hourlong outages.

Although industrial users of electricity are seeing even higher price increases, the burden falls heavily on small businesses because they have fewer options, said Jack Kyser, chief economist for the Los Angeles County Economic Development Corp.

Big companies with facilities in another state can switch production to that state and get by, Kyser said. But mom-and-pop outlets are stuck here.

Many merchants can't just raise prices, because of fierce competition. And reducing costs by trimming a bloated work force does not come into play when there's no bloat, Kyser said.

Even business owners in Los Angeles, which has its own stable source of power generation, are worried. Out-of-state customers, alarmed by reports of California's crisis, are getting jumpy about Los Angeles firms' ability to fill contracts, regardless of the facts, Kyser said.

All this means that small businesses are barreling into uncharted territory.

"What we are finding is that small business, no matter where it is located, is sort of scared silly," Kyser said.

A Kilowatt Here, a Kilowatt There

Many shop owners are just now getting down to the nitty-gritty details of how to shave a kilowatt here and there.

The first thing Susan Cho did was remove every other bank of overhead fluorescent bulbs at her 4,000-square-foot cleaners in Ventura. Then, she and her husband, Suk, purchased a new industrial dryer and shirt presser that operate on less energy.

She turned off an illuminated sign outside and unplugged a soda machine, replacing it with a water cooler. Cho's 14 employees are instructed to turn off lights whenever they are not in use and to completely fill dryers before running them.

"I'd walk by and there would be two or three blouses in a machine," Cho said. "No more."

These small steps added up to big savings. Cho estimates she spends $300 to $400 less each month on electricity than she did a year ago. She told a friend who also owns a dry cleaning shop what she had done, Cho said, and also shared tips with her Korean business association.

Trimming energy usage is trickier for Ackerman. The Orange County ice distributor can't just turn down the temperature on his 18-by-22-foot walk-in freezer.

But he does plan to turn off the air conditioning elsewhere and use lower-energy fans near the freezer during summer months.

Ackerman also checked out the possibility of buying a gas-powered generator to run his compressor during hot afternoons. When he learned that he would not receive a rate break for voluntarily taking his freezer offline, he dropped the plan.

"I'm too small of a business to fall under any of the [rate-reduction] programs available," Ackerman said. "So I'll just suffer through the summer."

At Print Masters in Long Beach, Dody Lopez runs jobs on the main copier only during morning and late-afternoon hours. That way, power usage--and the heat the energy-hungry machine generates--are idled during peak energy hours from noon to 4 p.m.

All four copying machines are equipped with a device that switches to a power-saving mode when not in use. Lights are dimmed wherever possible and the air conditioning has been replaced by fans and fresh air from open doors.

"People are complaining about the heat, but we explain to them that we are trying to be good citizens and trying to get through this crisis without getting completely shut down," Lopez said. "Most people are understanding."

Shop Owners Cross Fingers

Conservation, of course, is not on the minds of everyone. Several merchants report that they haven't given it a thought or have adopted a "whatever happens, happens" approach.

And anger over the continuing crisis simmers, especially with those who have done nothing to prepare.

"What can I do? Tell me what I can do," said an annoyed Vassil Perpchinkov, owner of Guido's, an Italian restaurant in Malibu. "This problem should be solved by those higher up--it better be."

Kerry Nelson, a Granada Hills print shop owner, doesn't have to worry about blackouts. Like other businesses in Los Angeles served by the Department of Water and Power, there is enough voltage to go around.

Because of that, Nelson said he has not attempted to cut back on usage. Still, he has sympathy for other small-business owners.

"I deal with some people out there who have had some problems. I really feel for them," he said. "But there's nothing I can do right now except be grateful that I am not facing the same thing."

Small business can also help itself by collecting and distributing conservation information in an organized fashion, said Hopper of the National Federal of Independent Business.

The first of 10 local councils that will be created across the state met last month in West Los Angeles to talk about ways to cut energy costs, he said. Other groups will be formed in East Los Angeles, Orange County, the Ventura-Santa Barbara region, San Diego, Sacramento and the Bay Area, Hopper said.

Suggestions at the West Los Angeles gathering ranged from adding a temporary energy surcharge to installing fluorescent bulbs that save energy.

"What business owners need right now is practical information on how to reduce costs," Hopper said. "That's what these councils can offer."

The councils will encourage the federation's 38,000 California members to fan out at the local level to make sure that the effect on small business is taken into consideration when new energy-related laws are passed, he said.

That kind of lobbying is important amid all the commotion, Kyser said.

"It's going to be a very unsettling period for a lot of these small businesses," he said.

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