Utility bankrolls efficiencies

LONDON, ONTARIO - London businesses got more than $7 million from London Hydro in 2010 — and that will grow to more than $10 million this year — as the utility writes more cheques to make workplaces energy efficient.

More and more industries are asking the electricity provider to help pay for revamping their workplaces — for everything from changing light bulbs to revamping power systems.

And thatÂ’s just fine with London Hydro, says program manager Hans Schreff.

“We want to write cheques. The more cheques the better,” he said at a manufacturers’ convention at the London Convention Centre. “There has never been a better time to look at electricity costs.”

Schreff was speaking at For Manufacturers Only, a conference at which manufacturers gather to discuss pressing issues for industries, and how best to tackle them. The rising cost of energy was top of mind.

Electricity bills will rise more than 40 over the next five years because the province needs to invest in improving its power grid, as well as in new green technology such as solar and wind power.

Industry needs a break from those prices and the utility can help, Schreff said.

“It is an easy way to lower operating costs — be competitive, do the right thing for the environment. And we have done lots of it in London. The payback is often less than a year,” he said.

In London, medium-sized businesses got $2.3 million back and small business about $5 million.

“People are taking their savings and reinvesting in their business,” Schreff said.

The agency often pays half the cost of a new system and the energy savings make it a moneymaker within a few years, depending on the job, he added.

He has already installed energy-saving systems at major industries here including Kellogg, Electro-Motive, Accuride, and a host of offices and multi-residential homes.

“You have to take advantage of this opportunity,” he added. “Once you see the math you will have to do this.”

For example, a new light system at a major industry may cost $125, but London Hydro will pay a $105 incentive to install it. That system will cut energy costs 50, and offer better, brighter light with lower maintenance costs. It will also last longer, 40,000 hours as opposed to the 20,000 hours most fluorescent light systems last.

“It is amazing quality,” Schreff said.

The conference kicked off with David Gurnham, a partner at Deloitte, saying manufacturing remains a critical industry to the national economy — and London and Southwestern Ontario are the heartland of the sector.

“Economies based on the service sector become second-tier economies. A service sector not built on the back of a manufacturing sector... will not lift or sustain a national, provincial or local economy,” said Gurnham.

“It is crucial to the overall well- being of an economy.”

He pointed to strengths this area has when competing globally, pointing to a skilled, talented workforce, innovation, solid infrastructure, good health care, low business taxes and a well educated population.

Canada also has the best research and development tax incentives in the world, he said.

“But talent and innovation are what we have in abundance,” he said.

Still recovering from the worst recession in 70 years, exports have increased 50. Of all of Canadian exports, 75 still go the U.S., but there also is a “dramatic increase” in trade with Brazil and Mexico, he added.

“Canadian manufacturers are, on the whole, performing quite well,” Gurnham said.

In the morning session, about 300 London and area manufacturers heard from keynote speakers about pressing issues for manufacturing.