Editors Blog

Taking Care of Business: Economy Boost: Cutting Utility Costs 25 Percent

January 16, 2008
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No, I’m not boozing it up or making ridiculous headlines to attract your attention (unlike a certain editor-in-chief who uses “snow bunnies’ and sexy photos to boost his sagging readership). I am talking about a fantasy I had the other day (no, not a snow bunny fantasy.)

I tried to rationalize a way that our sagging U.S. economy could get a real shot in the arm - at least temporarily. At the same time this shot could momentarily slow down the obscene profits that utility companies and energy providers are enjoying (can you spell Exxon-Mobil and BILLIONS of profit?). It can also go a long way to silencing talk of the “R” word (recession), which seems to creep into our conversations.

I propose that for one full year, oil companies reduce the prices of oil used for gasoline and home heating by 25 percent, natural gas companies reduce the price of therms by 25 percent, and electric utilities reduce the cost of kilowatts by 25 percent. When you stop laughing consider what an impact it would have on your own business or personal expenses.

You would probably be able to maintain your hourly rates and enjoy some extra revenues on the plus side of the ledger, i.e., more profits. With that you can afford to pay your employees better (attracting the top notch performers), reinvest in new equipment such as service vans and computer software, wireless gadgetry, etc., pay for additional training for your employees (and yourself), and actually put a little more in your own personal bank account.

And speaking of personal, that 25 percent savings will be reflected in that remodeling project you’ve been putting off, the new washer and dryer you’ve wanted, a new car, money for kid’s schooling, an extra trip, and just an extra contribution to your nest egg.

A 25 percent reduction in energy costs could fuel new construction, new research and development, and more jobs. Too simple and too easy.

Pass this along to your local energy seller and service provider. They just might listen. Now, isn’t that better than reading about “snow bunnies?”

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John Hall blog

January 18, 2008
Mr. Hall, Your suggestion that big oil and energy companies drop their prices by 25% is ludicrous. You preach in your columns that HVAC contractors should expect 10% net profits because they are worth it. I agree. Do you think "big oil" that only makes about 6% net should drop their pants and create a world-wide economic crisis at the same time? For every year that energy companies have billions of dollars of profits, they have 2 when losses are staggeringly as large. Stick to hvac.


John R. Hall
January 24, 2008
Stick to HVAC? And deprive our readers of a good laugh? No way!

25% Utility Savings?

John Castoro
September 21, 2008
John! It has been about 10 years since my last letter. That one was on the lack of trained service techs and the reduction in vocational school students in the HVAC/R industry. I was a vocational school instructor at the time. Not much has changed since then, so I went into business for myself hoping to train whoever I met in the field that wanted training. By the way, it is working! Anyway, in response to this blog, I have just commented about the News' article on "Performance Contracting". My business, as is Hill-York, is a hybrid of this design and seems to be catching fire. A copy of my post follows this letter. I believe we can reduce our energy usage and still maintain comfort. The utility companies will always have the upper hand. They know we need them. Until we can "turn it off" and stop using fossil fuels, they have us. The most we can do is reduce our usage! Copy of post: Response to ACHR News article "Performance Contracting" September 15, 2008 "Great minds think alike!!!" This business plan is exactly what I have designed for my business. I have been designing and implementing ESCO ideas for my employers in the property management field for years and now have started my own company to sell these designs to anyone who requires a reduction in their utility budgets. I serve all communities including industrial, commercial and residential. Most 100 - 1000 unit apartment/condominium sites do not have the staff of experienced operators to see the energy waste in therir buildings. I sell that service through implementation of the hardware married to as much training as needed to get the operators up to speed to maximize savings. I am using an AVG/EZAutomation PLC based monitoring system to gather utility usage through their data aquisition software and use that information to make recommendations to operating procedures and capital improvement plans. Our industry is on the verge of an explosion of opportunities in the utility monitoring and performance contracting arena. Keep us informed! There must be hundreds of contracting firms like mine poised to begin offering these services. An experienced contractor or facilities manager can smell wasted fuel or electricity the moment they step into a mechanical room! Let's "Green Up" America and make a living at the same time! John Castoro Innovative Logical Controls, LLC Brick, NJ 08723 www.innovativelogicalcontrols.com Phone: 732-330-1775 ILCLLC@comcast.net



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