Ask a third- or fourth-generation LBM executive about his company's sawmill roots, and you'll hear tales about how an ancestor created the millrace or fed the steam engine that powered the saws. Making your own power was part of the job. It's heading that way again, but with a 21st-century twist.
Whether you should follow either path depends on four things:
- How important the environment is to you
- How much are your energy costs
- The state of technology
- If your local jurisdiction will subsidize the switch.
Combine these factors, and you get widely varying results. For instance, when Hayward Lumber Co. opened in June 2002 the nation's only completely solar-powered truss plant, president Bill Hayward expected it would take until 2009 for the savings on electricity to cover the extra cost of the solar units. But since then, electricity prices have increased 15%. Now, Hayward figures the investment will pay off in just five years.
Likewise, in the late 1990s when Don Sather, owner of BigHorn Building Materials in Silverthorne, Colo., began to plan a building that would include solar panels, he based his 23-year return on investment in part on the assumption that power prices would increase around 5%. The actual increase has been much more, so the solar units would have broken even earlier–if the photovoltaic cells had performed as well as originally specified.
"We were a little ahead of our time," Sather says. Some parts had to be jury-rigged to make the system function at some cost. Had electricity prices not gone up, his payback would have stretched to 30 years. But with the increases, it has moved closer to his original plan.
California and Colorado are among states whose governments and utilities have rebates and incentives to promote the use of alternative energy. Rules vary by state, so check with local authorities on what's available.
Wind is one of the most efficient ways to harvest renewable energy. Using small wind turbines can lower electric bills by 50% to 90%, according to the Energy Department. BigHorn installed one to cool its electronics systems. However, the turbines–which cost $3,000 to $5,000 per kilowatt generated and usually pay for themselves in 15 years–need specific conditions to work properly. The Wind Energy Association says wind works best for rural businesses with "at least an acre of property, class 2 winds, and utility bills averaging at least $150 monthly." Also, zoning laws must allow a business to erect these tall turbines.
Some utilities offer ways to purchase alternative energy. By paying a premium, a business can specify that its electricity should come from renewable sources. Visit www.eere.energy.gov/greenpower/ to learn what is available in your state.
Going through its utility to buy 100% wind energy generates no savings for Pioneer Millworks in Farmington, N.Y. But marketing manager Jennifer Young says the company feels it is the right thing to do. Dealers note that using all alternative energy can help a dealer stand out and also attract more customers who are interested in green. BigHorn saw a rise in sales even before construction was finished on its energy-efficient property.
Another way dealers can buy alternative energy is through Power Purchase Agreements, in which a company will install and maintain a system on a dealer's property at no cost to the dealer, and the dealer will give the company any rebates or energy credits. Then the company will charge the dealer a fixed rate on electricity, for example, 12 cents per kilowatt-hour. Because that price is set, if utility electricity costs go higher than 12 cents, the dealer will profit.
"There's a misconception out there that renewable energy isn't a viable financial option," says Steve Linton, green building coordinator for Deltec, a home builder and component manufacturer in Asheville, N.C. "But when you look at it, it is. Find someone in your area to help you investigate how much it would cost. It's worth it, for sure."
–Victoria Markovitz and Craig Webb