Strategic Capital Budgeting – Distributed Energy Management

A strategic capital budget is more than just a pot of money to buy large, expensive equipment.  It is a plan that was designed to meet your current day operational needs as well as support future growth of your business. A strategic capital budget for efficiency is just that – a plan for how to save capital today to better improve your business tomorrow. Indeed, there are many improvements that will save you money and many that you could pursue. However, it is not always possible to do every one. Which areas of your business will have the highest impact on energy reductions? Which ones will have the highest impact on your bottom line?

Sadly, today there is very little visibility into how efficiency can improve your business case. Frequently business owners have a mindset that energy is not something they have control over, or they just pay the utility bill without thinking about it. Retrofit programs and upgrades abound, but they are each very expensive and can take a lot of time to learn, to understand the nuances, and to finance. There has been very little transparency to help business owners make those tradeoff decisions between capital improvements.

At DEM, we understand these challenges and we put your business needs first. We start by first understanding your business goals. We then investigate your energy needs. From there, we help match the energy goals that give you the best returns. We put you on a savings plan that allows you to reach that goal in a timeframe that makes the most sense. We realize that every customer is different and we are ready to work within your constraints.

In addition to bringing clarity to the budgeting decision, we work with you in drafting a plan to reach your goals. We help you set aside funds early on a monthly basis. We then apply your savings to executing efficiency investments that reduce your operating costs. We are able to capture the utility cost reductions back within your capital budget, allowing you to grow faster.

This gives the business owner much more visibility into the workings of energy management. Our clients are able to make prioritized decisions based on their energy needs and have a savings plan to reach those goals. It is one turnkey solution to identify, manage, execute and finance all aspects of efficiency.

via Strategic Capital Budgeting – Distributed Energy Management.

electricity rates

Does higher electricity rates result in larger bills?

Obama’s announcement of carbon pollution regulation certainly caused a stir. Environmentalists hail the plan as a big deal for climate change.  Critics blasted it will drive up electricity rates. Both are important points. However, a business person needs to know how this will affect their bottom line.  In essence, does a higher electricity rate result in a larger bill?

The answer is no.

We would expect that states with the lower rates pay less in bills.  But according to data from the Energy Information Administration, that is not the case.  From the graph, we can see that a Washington state homeowner pays the same amount as a California homeowner. This is in spite of electricity rates in California being nearly double the rates in Washington.  In fact, residents of Alabama pay nearly twice more per month to run their homes, despite electricity rates being 30% lower than in California!

States with higher rates also invest in energy efficiency.  If anything, higher rates motivates homeowners buy insulation, seal windows, replace hot water heaters, etc.  This can increase the demand for construction jobs – a positive for the economy.

In summary: yes, the climate action plan will affect climate change.  It will most likely increase electricity rates.  But no, it may not result in a larger bill.

For more info:

via Does higher electricity rates result in larger bills?.

Jimmy Jia

Energy Costs

Energy Costs Should Concern You and Your Business

Energy costs are rising.

Nationally, electricity rates have risen by nearly 6% across the country.  This is higher than the rate of inflation.  Some regions have seen far greater rises than others.  Hawaii has seen a 50% increase in rates since 2009 and Chicago may see a rate increase of up to 18% in 2014. These costs are going up due to the replacement costs of aging infrastructure.

How do you make utility forecasts in the face of non-uniform costs?

Energy issues are strongly tied to sustainability.

Fossil fuels dominate over 82% of our energy consumption.  The more expensive renewable energy makes up less than 10% of our fuel mix. Many feel our priorities should shift to consuming more renewable resources.  At the same time, our population is growing.  The Department of Energy (DOE) estimates that USA electricity demand will grow by nearly 30% by 2040.

How should you responsibly grow your business in the most cost-effective manner?

Energy is treated as a ‘black box’.

People feel unable to make energy decisions.  The electric grid, pipelines and roadways are treated as monoliths.  They seem larger than any individual.  Decisions seem to be made in private board rooms.  Rate increases are approved by state utility commissions that operate on a different timeline than businesses.  Energy costs seem out of your reach.

How do you gain control over your energy needs?

Create visibility around your goals.

These seemingly intractable problems have been solved in other industries.  Before cloud storage services, companies lacked datacenter expertise.  Before private branch exchange (PBX) and voice over IP (VoIP), companies had few choices over telecommunication expenses.  Today, CFOs can depend on professional services to deliver simple solutions that meet their goals. Similarly, no business has a core competency of paying utility bills and applying for utility incentives.  Set a goal, create a plan and we can help you get there.

Where are you going?  How are you going to get there?

via Energy costs should concern you and your business.

Jimmy Jia

Preventable Medical Errors

Preventable Medical Errors, Third Leading Cause of Death in America


My Dad was killed by a preventable medication error and poor hospital care.  There was no accountability, and the hospital never reported any adverse events that my Dad suffered at the hospital. Yet hospital-acquired conditions including adverse drug events and bedsores are required to be reported by state law. Our medical and legal system failed my Dad and my family miserably.  This was a wake up call for me that we must make our current medical system safer, otherwise we are all at risk of harm.

In its 2000 report, “To Error is Human, the Institute of Medicine (IOM) estimated that 98,000 people are killed each year because of preventable medical harm. The IOM declared that “it is simply not acceptable for patients to be harmed by the same health care system that is supposed to offer healing and comfort,” thereby setting a goal to reduce medical errors by 50% over five years.

Scan 1 Scan

Also in the same year of 2000, Dr. Barbara Starfield showed grim statistics of US healthcare: 12,000 deaths from unnecessary surgeries; 7,000 deaths from medication errors in hospitals; 20,000 deaths from other errors in hospitals; 80,000 deaths from hospital-acquired infections; 106,000 deaths from prescribed medicines.  This brought the total annual deaths to 225,000, making medical care the third leading cause of death, right after heart disease (597,689) and cancer (574,743).

A more recent estimate by Dr. John James, a former NASA medical scientist and a patient safety advocate, has shown that the number of preventable deaths is actually much higher. When taking into account the hidden adverse events that are not documented in medical records, errors of omission, and diagnostic errors, Dr. James estimated that the number of deaths associated with preventable medical errors may be as many as 440,000 a year, which is over 1,000 people a day! This number is roughly one-sixth of all deaths in the United States each year.

It is extremely disturbing that patients’ deaths due to preventable medical harm are not being reduced. Instead, 15 years later, we are still stuck with the same third-leading cause of death by preventable medical errors. This harm has reached both epidemic and pandemic levels.

Starting out to make a difference, I and a number of concerned Washington State citizens formed a patient safety organization (Washington Advocates for Patient Safety). Our goal is to raise public awareness on quality of care and patient safety, with a mission to make healthcare more transparent and accountable for consumers and patients.  This month, I drafted a letter to over 200 Representatives and Senators who serve on Congressional health committees to ask them to set patient safety as a national priority to save more lives. I am honored to have Consumers Union and 33 other patient safety colleagues who are with Consumers Union patient safety network around country co-sign the Letter to Congress.  On July 10th, my Dad’s birthday, we mailed the letters to Representative Jim McDermott, Senator Patty Murray, and Senator Maria Cantwell.

Here is a news release from Consumers Union about this letter campaign and a copy of this Letter to Congress:

Also, last week the Senate HELP Subcommittee conducted a hearing — More Than 1,000 Preventable Deaths a Day Is Too Many: The Need to Improve Patient Safety. Both of my patient safety colleagues, John James, who co-signed our letter, and Lisa McGiffert, Director of Safe Patient Project, Consumers Union, testified before the HELP committee. Anyone who cares about patient safety should watch this hearing:

Washington Advocates for Patient Safety

Washington Advocates for Patient Safety

It is past time for a change.  We cannot keep doing the same thing and expecting our broken system to change.  How can it be that our medical system is the most expensive in the world, yet also one of the worse among modern countries?  We call on the public to please join our efforts to eliminate preventable medial errors and to make health care safe for all of us.  Write to your congress person and tell them we need real change and protection from preventable medical errors.

Yanling Yu, President
Washington Advocates for Patient Safety

The Business of Planting Trees

The Business of Planting Trees | Pinchot


A business sustains its operations by making money. Revenues must be greater than expenses, and a successful business is able to repeat this year over year. To do so, they must manage risks to both sustain and grow revenue while controlling and lowering expenses. Businesses manage revenue-side risks by erecting competitive barriers to entry, investing in marketing and training a sales force. They manage expense-side risks by creating rules around fiscal discipline, developing risk-management policies and buying business continuity insurance.

An ecosystem sustains itself with a constant influx of resources. Moss needs moist soil and fallen biomass to grow, herbivores need a steady supply of fauna to forage and omnivores need a large supply of prey for the hunt. Large ecosystems have also learned to manage the risks of natural disasters and biology has developed innovative means to ensure resiliency. Wildfires in redwood forests clear out low-level brush, removing resource competition for the more mature trees. Monarch butterflies poison the birds that eat them, protecting themselves from harm. Fish swim in schools to confuse their prey.

A sustainable business is therefore the logical merger of these two concepts.  It is a business that makes money while giving back to the environment more than it takes away.  This might seem strange but the concept is, in fact, many hundreds of years old.  The medieval colleges of Oxford and Cambridge built their buildings out of stone and trimmed the inside of the rooms with wood. The architects immediately realized they faced a sustainability risk. The stone walls would last for many centuries but wood trims had a lifespan of a mere 150 years. To solve this issue, the colleges bought land and planted forests. By the time the trees matured, the wood within the colleges would be in need of replacing and new trees would be planted, continuing the cycle.

Some of the challenges we face today exist because the risks faced by the environment do not match the deliverable-driven risks of the business world. After all, the environment works on a generational timescale while business care about hitting next quarter’s targets. But if businesses planned for longer cycles, they would be better matched to environmental needs as well. There are several century-old companies that plan many decades into the future, and it is no surprise that each of their plans calls for planting trees today. Perhaps if all businesses operated on a 50-year plan, they’d all be planting trees too.

via The Business of Planting Trees | Pinchot.

Jimmy Jia

Page 2 of 212