Aberdeen grocer Ken Fiedler is now a really green grocer. He's swapping out the lights at Ken's SuperFair Foods for LEDs, which will use less electricity, last longer, and make the store and parking lot brighter. He's installed equipment to better regulate power usage in the coolers and freezers.
The green reason for these upgrades is to use 21% less electricity. The green reason is to save $18,970 a year on the electric bill.
There's also one more nice boost for Fiedler's bottom line, brought to us by President Barack Obama:
In addition, there are tax benefits for businesses that install new equipment. Ken's can file for a one-time tax incentive of $56,957. The Section 179 Internal Revenue Service deduction was part of the federal stimulus package passed early in the Obama administration. The deduction expires at the end of the year.
The total savings for Ken's this year, including the one-time exemption, will be $75,927, Fielder said [Jeff Natalie-Lees, "'Green' Project Cuts Costs at Ken's SuperFair Foods in Aberdeen].
Better lighting, less fossil-fuel pollution from power plants, and more money left in a small business's pockets—that's the stimulus and your President at work for you.
Cory: the bottom line at Ken's is not the bottom line for the economy as a whole. If it saves him money, great. But one of the things we know for sure is that improved energy efficiency does NOT lead to less energy used. A modern kitchen is full of devices that are much more efficient that their counterparts were decades ago. The modern kitchen also uses much more energy. Modern automobiles are much more energy efficient than previous vehicles, but mpg hasn't improved much of late.
The reason for this outcome is that we use the energy savings in our devices to pay for bigger devices and more of them. My mom's kitchen, when I was a boy, had a less efficient but smaller refrigerator and no microwave. My car is more efficient than the first one I bought. It is also bigger with a more powerful engine.
Impressionism is gratifying, but it is not substitute for analysis.
Oh, Ken, you're such a pessimist. Does Mr. Fiedler say he's going to use those savings to put in more freezers or other energy-consuming devices?
Ken's first car must have been a VW or a Fiat.
(My first car was a 1964 VW Beetle. Second car was a 1962 VW Beetle. Each lasted a couple months. Sixth and current car is a 2002 VW Beetle, holding up quite nicely!)
Youre a step up from me Cory, first car was a 58 Morris Minor convertible. Lasted about two weeks. You liberals had all the fancy cars.
Blanchard's response must be a joke or an imposter is posting with his name. What he appears to be saying is a more energy efficient house that cuts its heating and cooling bill by a couple thousand dollars a year does not produce savings. Real research proves otherwise. In fact it shows that a house built to current energy standards will cost a little more, but that the savings produced will pay for itself within five years. After that, the owner will continue reaping savings from that original investment throughout the duration of the 15- or 30-year mortgage.
If you're a banker, who would you rather invest in: Someone who invests in her/his house and ultimately spends less on energy payments, or someone who bought the energy clunker and who bleeds cash to the energy corporations?
If you're buying a house, which would rather buy? The clunker or the saver?
If you're trying to sell a house, which would rather put on the market? The energy clunker or the house that keeps more money in the owner's pocket?
I think Kessler, who didn't make a ton of money by being wasteful, chose to invest wisely in his business to keep more money in his pocket in the long run instead of fattening the bank account of the energy corporation.
If Fiedler's investment in more efficient power allows him to invest in other profit-enhancing appliances, Blanchard should be happy: the grocery store will enjoy greater productivity with the same amount of energy inputs. If the savings from the new lights and cooler-regulators make the difference in Fiedler's investing in more equipment or not, then the stimulus produced more orders and more economic activity than would have happened if Fiedler's capital was stuck in paying the old electric bill. If Fiedler doesn't buy any new stuff and just enjoys the savings, we see less energy used, meaning more energy available for future users. Either way, the stimulus is a winner in this case.
And Les, I wasn't a liberal yet back then. However, when I rolled that first Bug and walked away (actually jumped out and ran away, fearing an explosion) without any major personal damage, I did develop an appreciation for German engineering. That could have planted a seed of my faith in European socialism.
Cory: I don't know what Ken's will do with the savings from more efficient lighting, if indeed there are savings. I do know that energy efficiency does not lead to reduced use of energy. Dougal misses the point. A modern, energy efficient house may well pay for itself. But what does the owner do with the savings? If he buys a big, flat screen tv and then another for upstairs, plus a second freezer for downstairs... This is not pessimism, it is just a recognition of what people actually do.
Here is Ron Bailey: "Another study looked at trends in space heating efficiency [PDF] over the past 50 years in Melbourne, Australia. Modern houses are up to 10 times more energy efficient, yet the study found that modern Australians are collectively using just as much energy to heat their houses. Why? Modern houses are much bigger, people heat larger areas for longer, and fewer people live in each dwelling. The study notes, “The result that per-capita heating consumption has remained remarkably stable over the last 50 years.†However, modern Australians are much more comfortable in the winter than their grandparents were. "
I am very optimistic about this.
I'll grant, Ken, that when we use our efficiencies to consume even more stuff, we still have some work to do to promote the conservation mindset. But it's still a step in the right direction. Greater energy efficiency makes it easier for us to reach the point where we can get people to use less energy. Now keep an eye on Ken's Foods, and tell me when he expands the freezer section or adds more TVs to the café.
This Mr. Ken may not take his savings and "conserve" them, Mr. H. He will take the money saved by not consuming energy there at his grocery and will use it to buy an airplane or expensive vacations on cruise ships or giant screen TVs to make his nerd cave more like Stan G's. It is not an energy conservation it is a reapportionment of his share of the wealth to better serve him. That is how energy conservation works. I rest, you work more.