Wednesday, 30 November 2011 20:01

How energy policy could affect your bottom line

The state’s open energy market continues to provide businesses significant savings.

Retail choice has been a tremendous benefit to Pennsylvania businesses, and new products and services continuously provide greater benefit. However, businesses — with assistance from their energy supplier — need to monitor legislative and regulatory policies to ensure they maintain the benefits of energy savings and the promising developments in today’s energy markets.

“This is another critical time in our industry and for Pennsylvania businesses,” says Bob Barkanic, senior director of energy policy at PPL EnergyPlus. “Executives need to be monitoring pending policies and develop energy supply strategies to lock in these low energy prices.”

Smart Business spoke with Barkanic about new federal and state regulations and new energy policy opportunities.

What will happen to electricity prices as a result of new federal and state environmental regulations?

Protecting the environment is important to all of us. The challenge is balancing this objective with today’s current economic climate.

Our goal is to educate policymakers and customers to ensure the best decision possible is being made. For our customers, our objective is to explain the potential impacts and risks so they can procure their energy correctly. The proposed environmental regulations are expected to boost energy generation (production) costs, and these higher costs will eventually be passed along to businesses and households.

Environmental policies that potentially will have an impact on electricity prices are:

  • The Cross-State Air Pollution Rule. This EPA regulation takes effect Jan. 1, 2012, and requires 27 states, including Pennsylvania, to improve air quality by reducing power-plant emissions that contribute to ozone and particle pollution in other states.
  • Section 316(b) of the Clean Water Act. The EPA is developing regulations that require that the location, design, construction and capacity of cooling water intake structures at power plants reflect the best technology available for minimizing adverse environmental impact.
  • The regulation of coal combustion residuals. The EPA has proposed federal regulations to govern the disposal of coal ash and other wastes generated by electric utilities and independent power producers, which would potentially make handling more expensive.

These environmental policies are important to Pennsylvania and to our nation. The goal is to implement them correctly — with transparency and with an effective market structure — and to inform businesses of how to prepare for the changes that will result from the policies.

What effect will renewable energy requirements have on electricity prices?

Renewable energy, like environmental policy, is an important component of an effective long-term energy policy. PPL Corp. believes a balanced approach toward energy policy is vital to the economic health of our state and country. A balanced approach would be a prudent mix of nuclear, clean coal, natural gas and renewable energy resources. In addition to these physical assets, demand response, energy efficiency and energy conservation should be included in the mix.

However, a balanced approach is needed for renewable resources, as currently these resources may cost up to four to five times the cost of conventional generation. Most states, including Pennsylvania, have a Renewable Portfolio Standard (RPS) which requires that a certain portion of electricity production come from renewable resources.

As government has provided grants and tax incentives for these resources, more resources have been added than needed by RPS. Therefore, states are looking to increase renewable energy requirements, thus potentially increasing the costs of electricity for businesses.

What effect will the development of natural gas from Marcellus Shale have on Pennsylvania businesses?

The abundance of natural gas in the Marcellus Shale has the ability to keep Pennsylvania’s energy prices low for a very long time. These low energy prices will benefit everyone, by either lowering costs or by offsetting other cost increases in electricity and natural gas bills. In addition, drilling is boosting the local economy by attracting new companies, creating direct and indirect jobs, and generating lease and royalty checks for property owners.

The benefit of Marcellus Shale is meaningful. To ensure these benefits, policymakers, industry and the people of Pennsylvania must develop a well-defined and a properly regulated market structure. We all benefit from Marcellus Shale if done correctly — safely, continuously improving technologies and regulations, and with open communications.

What can policymakers in Harrisburg do to provide greater benefits from retail markets?

Pennsylvania’s open energy market has created a competitive business advantage, but more can be done. Executives and consumers still need to be educated on why they should shop for energy and how to navigate the retail energy markets. The Public Utility Commission is currently holding hearings on improving retail markets. There are many opportunities to improve the current market — modifying utility default service plans to better align with current market conditions, enhancing technologies to improve and increase product and service offerings, improving utilization of smart meters and continuing the education process. Fortunately, business leaders don’t have to wait; they can shop the market and enjoy lower rates today.

PPL EnergyPlus, LLC is an unregulated subsidiary of PPL Corporation. PPL EnergyPlus is not the same company as PPL Electric Utilities. The prices of PPL EnergyPlus are not regulated by the Pennsylvania Public Utility Commission. You do not have to buy PPL EnergyPlus electricity or other products in order to receive the same quality regulated services from PPL Electric Utilities.

Bob Barkanic is senior director of energy policy at PPL EnergyPlus. Reach him at (610) 774-6722 or RJBarkanic@pplweb.com.

Published in Philadelphia

Smart Business spoke to Edward Kubiak, Executive Vice President of Sales & Marketing at Phoenix Energy Technologies, about why now is the time to investigate sustainability initiatives to reduce energy use and costs in commercial buildings.

Nowadays, it’s no secret that getting hip to being green is good for business. And, when you’re delivering a consumer product, the eye-catching appeal of green materials, green packaging and green marketing makes good sense. However, in a B2B environment, and more specifically the commercial real estate market, leveraging green marketing to drive business development and customer retention leaves many unsure where to begin.

In a perfect world, electricity in your buildings would run using solar panels. You’d build exclusively with sustainable materials, and plant with indigenous landscape. Your tenants would vehemently recycle. And, they wouldn’t run the lights and HVAC system carelessly and unnecessarily.

But, just because the world isn’t perfect (there will always be those who bypass the recycle bin for the garbage can), doesn’t mean it’s time to throw your hands up in the air. Because, there are sustainability initiatives that not only improve public perception through environmental and corporate stewardship, they also save you money (big money) down the road. In fact, in the case of sustainable energy initiatives it can be a very short road, with ROI happening in a matter of months, not years.

As social, economic and regulatory pressures mount, commercial building owners are increasingly asked to do more with less. Only, as it turns out, when it comes to energy, “asking” building owners to do more with less is quickly giving way to public policy that demands a new way of doing things. Enter the Commercial Energy Rating & Disclosure Policy, legislation that targets the single largest consumer of energy in North America. Consuming two-thirds of the nation’s power supply and emitting 40 percent of the nation’s greenhouse gases, this policy aims to bring energy transparency to the commercial building market for the first time ever.

I recently came across a report from BuildingRating (www.buildingrating.com), which I found to be compelling in more ways than one. In essence, the report details a framework for implementing a commercial energy rating and disclosure policy, indicating that systems which capture energy data are quickly evolving from a “nice to have” to a “have to have” for commercial buildings in major markets. The legislation, which has been passed in five cities and two states (New York City, Seattle, San Francisco, Washington D.C., Austin, California and Washington State), requires that commercial building owners post their facility energy-performance data via the Web, enabling potential tenants, peers, investors, and the general public to access building energy data. While these policies are currently in their infancy, as an energy veteran, this transformation in the commercial building space is nothing short of revolutionary. Building ratings, data transparency that could influence customer and prospect behavior, and a new sense of accountability further drive commercial building owners to seek energy management solutions that facilitate compliance and drive a competitive edge.

Back in August, Phoenix Energy Technologies provided a Smart Business Insights article on enterprise energy management, detailing the ways in which technology can be leveraged to turn sustainability challenges into increased profit and reduced costs. This latest legislative development only augments the increasing need for such technologies in the commercial space.

The power of an EEM system lies in that historical data that is collected and benchmarked (a requirement of the passed legislation). Then, real time data is gathered, normalized for variables such as weather and schedules, and analyzed, allowing users to compare past use to current use in order to identify potential issues. Most importantly, with this information easily accessible and in an easy-to-interpret format, Facility and Operations personnel are empowered with the data they need to take action that reduces consumption and costs.

In terms of the U.S. Commercial Energy Rating & Disclosure Policy legislation, an enterprise energy management system is worth its weight in gold. Absent an energy management system, the process is tedious, laborious, and error heavy (we’re only human). On the contrary, utilizing the technologies available in the rapidly expanding EEM market, an automated data collection process facilitates compliance with the most stringent of standards.

With many vendor solutions available, I encourage you to explore the marketplace to find the solution that best fits your needs. With rapidly evolving standards, you would be wise to consider those vendors that offer a nimble solution that is capable of evolving and changing with the times. Most often, I have found software solutions, as opposed to hardware solutions, to be ideal under these circumstances.

There are cases in which being fashionably late to the party makes good sense. In the case of energy management, delaying a good, hard look at your current energy strategy — an inevitable consequence of this fledgling legislation — only delays significant, long-term savings potential. To view a complete copy of the report referenced in this article, please visit:

http://www.buildingrating.org/Building_Energy_Transparency_Implementation_Report

Edward Kubiak is Executive Vice President of Sales & Marketing at Phoenix Energy Technologies. Reach him at ekubiak@phoenixet.com.

Published in Dallas

Smart Business spoke to Edward Kubiak, Executive Vice President of Sales & Marketing at Phoenix Energy Technologies, about why now is the time to investigate sustainability initiatives to reduce energy use and costs in commercial buildings.

Nowadays, it’s no secret that getting hip to being green is good for business. And, when you’re delivering a consumer product, the eye-catching appeal of green materials, green packaging and green marketing makes good sense. However, in a B2B environment, and more specifically the commercial real estate market, leveraging green marketing to drive business development and customer retention leaves many unsure where to begin.

In a perfect world, electricity in your buildings would run using solar panels. You’d build exclusively with sustainable materials, and plant with indigenous landscape. Your tenants would vehemently recycle. And, they wouldn’t run the lights and HVAC system carelessly and unnecessarily.

But, just because the world isn’t perfect (there will always be those who bypass the recycle bin for the garbage can), doesn’t mean it’s time to throw your hands up in the air. Because, there are sustainability initiatives that not only improve public perception through environmental and corporate stewardship, they also save you money (big money) down the road. In fact, in the case of sustainable energy initiatives it can be a very short road, with ROI happening in a matter of months, not years.

As social, economic and regulatory pressures mount, commercial building owners are increasingly asked to do more with less. Only, as it turns out, when it comes to energy, “asking” building owners to do more with less is quickly giving way to public policy that demands a new way of doing things. Enter the Commercial Energy Rating & Disclosure Policy, legislation that targets the single largest consumer of energy in North America. Consuming two-thirds of the nation’s power supply and emitting 40 percent of the nation’s greenhouse gases, this policy aims to bring energy transparency to the commercial building market for the first time ever.

I recently came across a report from BuildingRating (www.buildingrating.com), which I found to be compelling in more ways than one. In essence, the report details a framework for implementing a commercial energy rating and disclosure policy, indicating that systems which capture energy data are quickly evolving from a “nice to have” to a “have to have” for commercial buildings in major markets. The legislation, which has been passed in five cities and two states (New York City, Seattle, San Francisco, Washington D.C., Austin, California and Washington State), requires that commercial building owners post their facility energy-performance data via the Web, enabling potential tenants, peers, investors, and the general public to access building energy data. While these policies are currently in their infancy, as an energy veteran, this transformation in the commercial building space is nothing short of revolutionary. Building ratings, data transparency that could influence customer and prospect behavior, and a new sense of accountability further drive commercial building owners to seek energy management solutions that facilitate compliance and drive a competitive edge.

Back in August, Phoenix Energy Technologies provided a Smart Business Insights article on enterprise energy management, detailing the ways in which technology can be leveraged to turn sustainability challenges into increased profit and reduced costs. This latest legislative development only augments the increasing need for such technologies in the commercial space.

The power of an EEM system lies in that historical data that is collected and benchmarked (a requirement of the passed legislation). Then, real time data is gathered, normalized for variables such as weather and schedules, and analyzed, allowing users to compare past use to current use in order to identify potential issues. Most importantly, with this information easily accessible and in an easy-to-interpret format, Facility and Operations personnel are empowered with the data they need to take action that reduces consumption and costs.

In terms of the U.S. Commercial Energy Rating & Disclosure Policy legislation, an enterprise energy management system is worth its weight in gold. Absent an energy management system, the process is tedious, laborious, and error heavy (we’re only human). On the contrary, utilizing the technologies available in the rapidly expanding EEM market, an automated data collection process facilitates compliance with the most stringent of standards.

With many vendor solutions available, I encourage you to explore the marketplace to find the solution that best fits your needs. With rapidly evolving standards, you would be wise to consider those vendors that offer a nimble solution that is capable of evolving and changing with the times. Most often, I have found software solutions, as opposed to hardware solutions, to be ideal under these circumstances.

There are cases in which being fashionably late to the party makes good sense. In the case of energy management, delaying a good, hard look at your current energy strategy — an inevitable consequence of this fledgling legislation — only delays significant, long-term savings potential. To view a complete copy of the report referenced in this article, please visit:

http://www.buildingrating.org/Building_Energy_Transparency_Implementation_Report

Edward Kubiak is Executive Vice President of Sales & Marketing at Phoenix Energy Technologies. Reach him at ekubiak@phoenixet.com.

Published in Orange County