March 8, 2007

By Diane Chiddister

The municipal energy efficiency program in the growing town of Wahoo, Nebraska, has enhanced that town’s economic development efforts, according to Wahoo General Manager of Public Works Jim Gibney.

“It hasn’t hurt us a bit. It’s probably made us more attractive” to potential businesses, Gibney said in an interview last week. For instance, he said, a new ethanol plant now plans to locate in the town, bringing more jobs.

“They were attracted by our proactive stance on energy issues,” Gibney said.

That Wahoo’s decade-long energy conservation program has contributed to the small town’s growth would not surprise Dennis Fannin, director of the municipal utility in Osage, Iowa, a community which has garnered world recognition for its energy conservation efforts. The financial windfall provided by Osage’s conservation program has not only brought to town some new business, but allowed existing businesses to expand, he said.

“Energy conservation has made them more competitive in their fields,” Fannin said.

In Osage, for example, Fox River Mills, a textile manufacturer that produces sports socks, reduced the energy costs of production by 29 percent per pair, a $150,000 savings annually. The business, which employed 110 workers in 1984, now employs more than 300.

That result falls in line with predictions by Smart Communities Network, which states that energy conservation has an economic multiplier of $2.32, meaning that every $1 spent generates $2.32 in economic activity. The economic indicator for consuming, rather than conserving, energy, is much lower, at $1.48, according to the Web site smartcommunities.org.

Wahoo and Osage resemble Yellow Springs in that they are small, largely rural midwestern communities that own their own municipal utilities. But they differ from Yellow Springs in that they were at the forefront of communities that took steps to encourage, and in some cases impose, ways for their residents to conserve energy.

The issue of how energy conservation affects small towns, and how much energy can be conserved, is a conversation that Village Council and villagers recently began. Prompting the conversation is the question of whether or not the Village should purchase a new $3.5 million electric substation. The new substation is needed soon, according to Village Manager Eric Swansen, because the Village’s current equipment handles loads far beyond its capacity, and has done so for years. The strain on the system caused near brownouts during the Village’s peak load period last summer, Swansen said, and more brownouts may be expected if the Village doesn’t do something soon.

Swansen has stated that he supports energy conversation steps, but that conservation by itself will not address the Village’s electrical system needs.

However, Council member Judith Hempfling and other residents have questioned the need to go ahead with the substation purchase, saying that the Village should take the time to explore whether conservation efforts could postpone the need to spend $3.5 million on the substation, and could also attract to town new businesses that are aligned with those efforts.

In Osage, conservation efforts did allow the town to postpone the upgrading of its electrical system for 12 to 14 years, according to Fannin. However, he said, if the system is currently unable to handle its load, conservation efforts alone may not be sufficient to preclude purchasing new equipment at some point.

Osage, a tiny northern Iowa rural community of about 3,500, has been called the “energy conservation capital of the world” due to the measures introduced in the early 1970s by former municipal utilities director Wes Birdsall. Since then, the town has attracted attention from all over the country and the world, bringing to town officials from such places as Sweden and New Zealand to study its conservation techniques.

The world-wide attention has enhanced the town’s sense of community, according to Osage City Clerk Cathy Penney in an interview last week.

“It’s a source of pride to us all,” she said.

Of course, she said, the citizens of Osage also appreciate the financial benefit they receive from the conservation measures. Currently, Osage saves about $1.2 million per year in energy costs from a program whose total costs were about $350,000, according to www.smartcommunities.org. That savings translates into about $200 less per year for a household’s energy bills, and most businesses save more.

The program basically consists of a lot of small actions that, together, add up to big savings, according to Fannin.

Osage’s conservation efforts began with the prescient vision of Birdsall, who took very seriously the potentially disastrous future effects of the 1970s Arab oil embargo, and set in motion the model conservation program that continues today.

As a first step, Birdsall took an infrared camera and flew above the town, snapping photos to show businesses and residents evidence of the energy loss in their homes and businesses. The Osage Municipal Utilities distributed to interested citizens free energy-saving materials, such as blankets for water heaters, flow restrictors and compact fluorescent light bulbs. The city also provided free energy tests and advice, and now about 90 percent of Osage homes are well-insulated. The program also included air conditioner and furnace tune-up rebates, free appliance testing and free low-flow water fixtures and energy audits.

The town’s load management program, in which air conditioners are automatically turned off for seven and a half minutes each half hour during peak summer season, has cut the town’s peak load by about 10 percent. About 96 percent of air conditioned homes are taking part in the load management program, according to smartcommunities.org.

Initially, the utility offered air conditioner users free water heater blankets or other conservation devices, as enticements to join the load management program. However, Fannin said, it didn’t take much to encourage people to join.

“If there’s some community spirit they should be willing without much incentive,” he said. “They do it because it’s the right thing to do.”

Recently, Osage has been working to find other ways to make the town more sustainable. For instance, Fannin said, several years ago the Osage municipal utility devised a way to provide telephone and Internet service for its residents. This move keeps more than $300,000 in the community that formerly went to the national companies of Quest and Mediacom, according to Fannin.

“The more dollars you can keep in town, the better,” he said.

In Wahoo, the town is saving about $75,000 a year in energy expenses after signing up only about 15 percent of air conditioning users in the past two years, according to Gibney. The percentage currently enrolled in the load management program is low because the program, begun a decade ago, was discontinued by a previous manager and only recently started up again. Gibney is only able to use two utility employees on a very part-time basis to install the load management equipment, he said, adding that he wished he could put more people on the job to help more residents join the program and save the town more money.

While Wahoo, with a population of about 3,800, employs a part-time energy consultant to provide energy audits, it has discontinued a previous program to provide residents with financial incentives for the purchase of energy-efficient heat pumps, lighting and insulation. That program was discontinued because the city had met its goals, according to Gibney.

“We’ve done a good job on our community awareness efforts,” he said. “We got the results we wanted.”

For more information on Osage, go to www.smartcommunities.ncat.org/success/osage_muni/shtml.

For information on Wahoo, go to www.smartcommunities.ncat.org/success/energy_wahoo.shmtl.

Contact: dchiddister@ysnews.com