Archive for the ‘Business’ Category:
31 Aug
SOURCE: New York Times
Donna Ings, 47, finally landed a job in February as a home health aide, earning about $10 an hour, with a company in Lexington, Mass, after being out of work for more than a year.
Chelsea Nelson, 21, started two weeks ago as a waitress at a truck stop in Mountainburg, Ark., making around $7 or $8 an hour, depending on tips, ending a lengthy job search that took her young family to California and back.
Both are ostensibly economic success stories, people who were able to find work in a difficult labor market. Ms. Ing’s employer, Home Instead Senior Care, a company with franchises across the country, has been aggressively expanding. Ms. Nelson’s restaurant, Silver Bridge Truck Stop, recently reopened and hired about 20 people last month in an area thirsty for jobs.
Both women, however, took large pay cuts from their old jobs — Ms. Ing worked in the office of a wholesale tuxedo distributor; Ms. Nelson used to be a secretary. And both remain worried about how they will make ends meet in the long run.
With the country focused on job growth and unemployment continuing to hover above 9 percent, there has been comparatively little attention paid to the quality of the jobs being created in this still-struggling economy and what that might say about the opportunities that will be available to workers when the tumult of the Great Recession finally settles. There are reasons, however, for concern, even in the early stages of a tentative recovery that now appears to be barely wheezing along.
For years, long before the recession began, job growth had become increasingly polarized in this country, with high-paid occupations that demand significant amounts of education and training growing rapidly, alongside low-wage, entry-level, service-type jobs that do not require much schooling or special skills, according to David Autor, a labor economist at the Massachusetts Institute of Technology.
The growth of these low-wage jobs began in the 1980s, accelerated in the 1990s and began to really take off in the 2000s. Losing out in the shuffle, according to Dr. Autor, are jobs that he describes as “middle-skill, middle-wage” — entry-level white-collar positions, like office and administrative support work, as well as certain blue-collar jobs, like assembly line workers and machine operators.
The recession appears to have magnified that trend, according to Dr. Autor in a recent paper, released jointly by the Center for American Progress, a left-leaning policy group, and the Hamilton Project, which has a more centrist reputation. From 2007 to 2009, the paper found, there was relatively little net change in total employment for both high-skill and low-skill occupations, while employment plummeted in so-called middle-skill occupations.
A new analysis by the National Employment Law Project, a liberal advocacy group, takes a different approach, identifying industries that have actually experienced job growth in 2010 and examining their median wages. It is a blunter measurement because it focuses on industries, within which there is often great diversity in income. Economists also cautioned that it was still too early to know exactly which sectors would eventually lead the way in a sustained recovery.
Nevertheless, the law project analysis offers a snapshot of where the employment growth has been so far. It found job expansion to this point has been skewed toward industries with median wages that are low to middling, with a disproportionate share of job growth happening in industries whose median wages fall below $15 an hour.
“There’s a striking contrast so far between which industries have lost jobs and which ones are growing,” said Annette Bernhardt, policy director for the law project. “If this kind of bottom-heavy job creation continues, it could pose a real challenge to restoring consumer demand and making sure working families have a way to support themselves.”
Both studies are disquieting because of the potential import for many who had once scratched out middle-class livings and are now looking for work. A unifying theme is the stubborn march of labor-intensive, low-paying service jobs, like the ones Ms. Ings and Ms. Nelson found.
Jobs dry up
Unless you’re in the software consulting business or work for one of the top pharmaceutical companies in the country, you’ve probably not noticed how the recession really works in terms of who gets laid off first and who is the first to be rehired.
There is typically a downward slide during recessions, said Till von Wachter, a Columbia University economist, in which higher-skilled and higher-educated workers are re-employed first, often landing jobs for which they are overqualified, squeezing out the lesser skilled and lesser educated. Indeed, in the current downturn, the unemployment rate has climbed the most for the least-educated workers, suggesting they have been hit the hardest.
However, while researching workers who lost their jobs in California in the 1990s, Dr. Wachter found that people who fall in the middle when it comes to their educational background — possessing high school degrees or some college — and the skills required for their occupation tended to experience larger and longer lasting income losses after job loss than people on both the lower and higher end of the scale.
Ms. Ings had worked in a variety of office and administrative roles in the wholesale tuxedo industry. Her wages of just over $16 an hour were enough to build a relatively comfortable life for her and her daughter, Jillian, now 21 and in college.
“During her whole growing up, I never got child support,” Ms. Ings said. “I always had to try to find a job that paid well to help support her. That’s my job, being a mother.”
When Ms. Ings was laid off in March 2009, she dove into finding another “corporate job.” But she found that nearly everyone seemed to be looking for people with at least a college degree, if not more. She had only a high school diploma.
As a teenager, she had worked in a nursing home and enjoyed it. So, after getting her certified nursing assistant license, she applied at the Home Instead office in Lexington, which has been steadily hiring this year, said Jack Cross, the franchise owner. Nationally, the company has created more than 2,400 jobs this year, and home health aides are one of the country’s fastest growing occupations.
Ms. Ings adores her job, but her finances remain taut, even though she is working 50 hours a week. She had been without health insurance for her first few months, but soon the company will begin deducting for it — a further pinch on her already meager paycheck.
“I’m going to be coming home with nothing,” she said.
In Arkansas, Ms. Nelson has been hampered by her decision to quit college after a semester several years ago. She has worked a variety of jobs, including a three year stint as a secretary, earning about $12 an hour.
Last year, she and her husband, Kenneth, and their son, Riley, now almost 2, moved to Colton, Calif., where they had relatives and believed the job market would be better. They moved back to Arkansas this year, however, after struggling to find steady work.
He quickly accepted a factory job at $8 an hour, but she got rejection after rejection trying to find office work.
She eventually gave up and took up waitressing. The couple is living with her mother, trying to save enough for their own place.
“I don’t know, with the jobs we have, if we’re ever going to be able to make it on our own,” Ms. Nelson said.
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MY TAKE: If you think you’re going to go from unemployment to that $60K a year job load testing position, or step right into a top collocation company, forget it. The chances are that, unless you own and manage that collocation firm or some other company, you’ll find yourself like this woman: working for less alongside less skilled younger workers.
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19 Aug
SOURCE: Associated Press
Unemployment insurance applications for first-timers reached the half-million mark recently, the first time since November, a sign that employers are slashing jobs once more as the economy limps.
The Labor Department said Thursday that initial claims for jobless benefits rose by 12,000 last week to 500,000, the fourth increase in the past five weeks. Wall Street economists forecast that claims would drop.
The four-week average, a less volatile measure, rose by 8,000 to 482,500, the highest since December. There were no special factors that distorted the numbers, a Labor Department analyst said.
The increase suggests the economy is creating even fewer jobs than in the first half of this year, when private employers added an average of about 100,000 jobs per month. That’s barely enough to keep the unemployment rate from rising. The jobless rate has been stuck at 9.5 percent for two months.
Stock futures fell on the news. The Dow Jones industrial average futures had risen more than 50 points before the report was released. They dropped quickly and were down as much as 20 points afterward.
Jobless claims declined steadily last year from a peak of 651,000 in March 2009 as the economy recovered from the worst downturn since the 1930s. After flattening out earlier this year claims have begun to grow again.
The number of people continuing to receive benefits fell by 13,000 to 4.5 million, the department said. The continuing claims data lags initial claims by one week.
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MY TAKE: I’m not surprised to hear the numbers of jobless claims is rising. I’ve been on unemployment since 2008 and the prospects for work are grim. Employers ranging from manufacturers of infant hair bows and wall padding, to the highest priced Dallas TX criminal defense attorney are all freezing hiring plans in an effort to ride out the double dipper.
The wholesale baby headbands company, the Dallas TX DWI attorney, and even the guys who make those signs you see on stadium poll pads are all cutting jobs to save their bottom lines, and who can blame them? If they go out of business they, too, would wind up in the back of the jobless claims application line.
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06 Aug
Source: Associated PressThe nation’s unemployment rate was unchanged at 9.5 percent in July, indicating companies’ ongoing reluctance to hire and prolonged economic recovery.
Private employers added a net total of only 71,000 jobs in July, far below the roughly 200,000 needed each month to reduce the unemployment rate.
Overall, the economy lost a net total of 131,000 jobs last month, the Labor Department said Friday, mostly because 143,000 temporary census jobs ended.
Investors reacted by selling stock futures and shifted into safer investments such as Treasury bonds. The yield on the 10-year Treasury note, which helps set interest rates on mortgages and other consumer loans, fell to 2.87 percent from 2.91 percent late Thursday.
The department also revised down its jobs figures for June, saying businesses hired fewer workers than previously estimated. June’s private-sector job gains were lowered to 31,000 from 83,000. May’s were raised slightly to show 51,000 net new jobs, up from 33,000.
“There is still a labor market recovery, but it’s a very, very weak one,” said Nigel Gault, chief U.S. economist at IHS Global Insight.
The slow pace of hiring will weigh on the recovery, he said, with economic growth in the current quarter likely to come in even lower than the April-to-June quarter’s already weak 2.4 percent.
The “underemployment” rate was the same as in June, at 16.5 percent. That includes those working part time who would prefer full-time work and unemployed workers who’ve given up on their job hunts.
All told, there were 14.6 million people looking for work in July. That’s roughly double the figure in December 2007, when the recession began.
Even if hiring picks up, it will take years to regain all the jobs lost during the recession. The economy lost 8.4 million jobs in 2008 and 2009. This year, private employers have added only 559,000 new hires.
Friday’s report is being closely watched by the Federal Reserve as it considers ways to energize the recovery. The report could persuade the Fed to take new steps to boost the economy and keep interest rates at record lows when it meets next week.
Without more jobs, consumers won’t see the gains in income needed to encourage them to spend more and support economic activity. Even those with jobs may not feel confident enough to ramp up their spending.
That’s important because many of the trends driving economic growth earlier in the recovery are fading. Companies boosted production in the winter and spring to rebuild inventories that were depleted in the recession. But that boost won’t last much longer. And the impact of the federal government’s stimulus package is also declining.
The economy grew at 5 percent in the fourth quarter last year and 3.7 percent in the first three months of 2010. But that slowed to 2.4 percent in the April-June period. That’s not fast enough to generate many jobs and reduce the unemployment rate.
Many companies appear to be getting more out of their current employees rather than adding new staff. The average work week increased by one-tenth of an hour to 34.2 hours, the department said. That’s up from about 33 hours in the depths of the recession.
Average hourly pay also rose 4 cents to $22.59, up 1.8 percent from a year earlier. That, along with the increase in hours worked, could provide some boost to spending.
The number of temporary jobs fell by 5,600, the first drop after nine months of gains.
Employers usually hire temp workers if they need more output but don’t want to hire permanent employees. But “firms aren’t even adding temporary workers right now,” Gault said.
This goes for workers across all sectors at companies ranging from manufacturers of garage floor mats , and jewelry display lighting to providers of payroll services.
Manufacturers added 36,000 jobs in July, slightly above its monthly average this year. Those gains were aided by General Motor’s decision to keep its plants running last month. Usually it closes them and temporarily lays off employees to retool for the new model year.
Construction firms cut jobs for the third straight month, losing 11,000, while financial firms shed 17,000 workers.
But retailers added 6,700 jobs. And the leisure and hospitality industry hired 6,000 additional staffers.
Corporate net income rose sharply in the second quarter, but businesses aren’t yet using the proceeds to ramp up hiring. Companies in the S&P 500 index reported a 46 percent increase in net income for the April-to-June period, compared to a year earlier.
But many employers are uncertain about the direction of the economy. Some are concerned sales will slow once government stimulus and other temporary factors fade. Others fear what will happen if federal income taxes are allowed to rise next year as tax cuts enacted by President George W. Bush expire.
“People have a long worry list they’re looking at,” said Ethan Harris, chief economist at Bank of America Merrill Lynch.
Some companies are adding permanent workers. The hospital chain HCA Inc. has 8,300 open positions, company spokesman Ed Fishbough said. That includes nurses, physicians and information technology professionals needed to build HCA’s ability to handle electronic medical records. HCA employs about 190,000 people.
But layoffs are also continuing. FBR Capital Markets, an investment bank based in Arlington, Va., cut its work force by about 15 percent in early July to about 500 employees, saying it needed to reduce costs.
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My Take: If it’s the garage flooring or makers of those time and attendance cards holding out on hiring, then you have to wonder what’s going to happen at the little retailers this fall when all the college kids come back from summer vacation and start job hunting for the school year. I know the jewelry lighting manufacturing business has to be hurting, but what about the fast food chains and the clothing stores and the i-hiring Mecca of all: Appple? I walked into an Apple store the other day and there must have been 100 blue-shirted employees running around? Maybe what’s going on is that the jobs aren’t drying up, but that their sector availability is changing?
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23 Nov
Cited: BusinessWeek
George Colony, CEO of Forrester Research, has been advising CEOs on the business impact of technology for 30 years and blogged about how to change information technology to business technology. He has spoken of how to convert business technologists and business people for the past four years and he calls the concept ” moving from information technology to business technology — or IT to BT.”
At its core, I define BT as measuring your usage of technology with business metrics instead of technology metrics. The message is for IT to measure itself using business metrics that matter to the COO, CEO, and board of directors, instead of assessing its success with a technology yardstick, such as network availability or server uptime.
It’s not the mean time between failure or server response times that matter. If you change that one word from information technology to business technology, you begin to change the way IT people work and the way they think about their jobs.
Although this mental shift is happening slower than I figured, a generational change in IT and business leadership is beginning to force the issue. Now we’re seeing the older baby boomer generation beginning to retire, and for the first time, we’re getting CEOs of Fortune 500 companies who had an Apple II when they were 12. So now you have CEOs and presidents who are far more technology-focused. We’re no longer seeing so many people who are getting emails printed out — instead, these top execs actually read them. You know, business leaders actually use these IT devices today — maybe an iPhone or BlackBerry or Kindle —and now you have technologists who had an Apple II as a kid. Both groups of execs understand the evolution of technology out to people — technology populism, if you will — that we all have high-tech devices, and there’s now this new way of thinking and working.
Since the last technology recession from 2001 to 2003, CFOs have been looking more closely at IT spending, which accelerates the shift to BT. The overspend on technology in 2000 was so large — it was about $60 billion in the US — and that was the death knell of runaway technology expenditures. At that moment, CFOs and CEOs said, “We’re never doing that again. We’re going to have tight linkage here, higher return there.”
We’ll look back at this decade as a series of learning moments, and the real turning point from IT to BT is the two recessions, the customer moving clearly to the center stage because of the Internet, and the generational change in senior execs.
I’ll talk more about this at Forrester’s Business Technology Forum in a couple of weeks, but there are three questions companies should ask themselves before transitioning from IT to BT. First, you need to ask, “do we have the right CIO?” The CEO has to look in the eyes of the CIO and make the judgment “Is this person good enough to understand the business?”
Second, you should ask, “do we govern in the right way?” If the decision-making goes from the CEO to the CFO, or maybe to the COO and then to the CIO, I don’t think you’re ever going to get this IT-to-BT change to happen because the CIO is too far removed.
Third, you need to ask, “do we have the right business executives?” The onus is not just on the CIO; we need higher IQ in technology across all of the business executive levels.
If the answer to these three questions in is yes, you need to figure out how to get your business there. The top executives, CEO and CIO, need to sit down and figure out how to change the focus from IT to business. There is no technology god will do it for you or even advise you.
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My Take: I really don’t get the gist of this article. As far as I can see, most businesses and corporations have already gone IT. Maybe I’m just not seeing what is meant. The reason I say this as I see so many businesses and corporations online selling various items like cool t shirts to an electronic cigarette.
Maybe it is not the point that the businesses are selling limited edition T shirts online or ecig chargers. Maybe it is the idea of using information technology within the business to improve business. I could be completely off track here. But, it still seems that businesses online selling funny tees have already gone IT. Maybe going IT is not just the selling of funny T-shirts but the marketing and design of those shirts.
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Groupon Clone Software and Customers
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06 Nov
Cited: BusinessWeek
The race to pick the startups aiming to revolutionize clean tech has former Silicon Valley allies going head-to-head. John Doerr and Vinod Khosla have worked together for nearly 2 decades at Kleiner Perkins Caufield & Byers to build one of the most lucrative partnerships in venture capital business. Between them, they brought together Netscape Communications, Amazon.com (AMZN), and Google (GOOG), Juniper Networks (JNPR) and Cerent (CSCO).
Now the former colleagues are competing to fund the most promising startups in clean technology, a potentially lucrative but risky field many believe could lead to Silicon Valley’s next boom. Doerr, still at Kleiner, helped shift his firm’s focus from information technology to green investments a few years ago, with help from partner Bill Joy, former chief scientist at Sun Microsystems. Khosla, who left Kleiner five years back, just raised $1.1 billion from partners and institutional investors, giving his Khosla Ventures the heft to compete for the most capital-intensive deals. “These guys are in a race” for the most important green deals, says Paul Deninger, vice-chairman at investment bank Jefferies & Co. (JEF)
Kleiner is the established giant. The firm has raised a total of $5.9 billion since its founding in 1972 and, in addition to Doerr’s hits, helped launch America Online (TWX) and Genentech (DNA). Still, the firm is a relative newcomer to green investing. Khosla has been dabbling in such deals since he started his outfit in 2004. With his fresh capital, he is on the hunt for the most ambitious startups. “Our specialty is risk,” says Khosla. “Forget [hitting] singles. Lay it out there and take a swing. You may not get a very high percentage of hits, but you get a high slugging percentage.”
Khosla’s approach is to winnow losing ideas quickly before they consume too much cash, gambling that the surviving startups can score big. Whereas most venture capital firms budget for product-development milestones by the companies they invest in, Khosla Ventures uses metrics that forecast how much it will cost for startups to remove technical risks, tackling the toughest problems first. “We’ve developed a few tricks,” says Khosla.
Take Calera, a startup launched by Stanford University. Its goal is to reduce emissions by making cement that traps CO2 gas during manufacture. Khosla figures there’s a 
10% chance his firm can make 100 times its eight-figure investment and a 90% chance the company will fail. That’s precisely the kind of prospect that draws his attention. “Sometimes we tell an entrepreneur, ‘Your project does not have enough risk for us,’” he says. “They look at you kind of funny.”
Many of the startups Khosla has backed aim to collect power from the sun, harvest it from the wind, or extract it from the earth. Soladigm makes glass windows that can lighten or darken to heat or cool rooms, and GreatPoint Energy converts coal into natural gas. Others are trying to invent more efficient motors and batteries. EcoMotors International in Troy, Mich., for instance, makes light, powerful diesel engines.
Kleiner is making similar investments. Its deals include hybrid sportscar maker Fisker Automotive, smart grid company Silver Spring Networks, and Bloom Energy, which is developing a fuel cell that can convert natural gas into hydrogen fuel.
Both companies say this is a friendly competition. In fact, Khosla and Kleiner have co-invested in several deals. “I spend more time with [Doerr] now than I did when we were at Kleiner,” Khosla says. Still, he acknowledges that both want to be first to find and build the world’s most influential green-tech startups.
The competition could help speed the development of green technologies. Although the industry is perceived to be full of promise, it’s fraught with challenges, too. The field is marked by high startup costs, powerful customers and competitors, and government regulations that can change unpredictably. Venture capitalists scaled back their clean-tech investments during the downturn, putting $1.6 billion into such startups during the first three quarters of 2009, vs. $3.1 billion during the same period in 2008, according to PricewaterhouseCoopers and the National Venture Capital Assn.
So far this year only two North American clean-tech companies, Canadian geothermal outfit Magma Energy and battery maker A123 Systems (AONE), have gone public, and there have been just nine acquisitions worth more than $10 million in the market, according to investment bank Jefferies. Funding energy companies “is a difficult and new experience for many VCs,” says Adam Grosser, a general partner at venture firm Foundation Capital.
Both Khosla Ventures and Kleiner have made losing bets. The firms invested in ethanol maker AltraBiofuels, which late last year closed one factory and suspended production at another after raising $170 million. Ethanol producers have stumbled due to overproduction and demand that declined as the price of gasoline fell. Khosla Ventures wrote off the investment and lost money. “If people want instant gratification, they’re going to be disappointed,” says Ted Schlein, a managing partner at Kleiner Perkins.
Patience may well pay off. Entrepreneurs say Khosla, now that he has deep pockets to go along with his aggressive investment approach, could help develop a new generation of green startups. “[Vinod] can add tremendous value by giving people very direct advice about what does or doesn’t make sense,” says Andy Bechtolsheim, who co-founded Sun with Khosla in 1982 and is now chief executive of startup Arista Networks. “He wants to bet not just on significant ideas, but ideas that can change the world.”
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My Take: One thing is definite; we need more green technology businesses to avoid further global warming. Hopefully, this venture will succeed in more green technology type businesses will be fruitful. It will also help the unemployment rate across the nation.
It is always a good sign when new businesses open up. It means not only is the community growing, but it also means that the economy is doing better. With new businesses opening up, more job’s are becoming available and people will be working again.
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Green Beauty Products
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06 Nov
Cited: BusinessWeek
Companies as varied as Cisco, PG&E and Cargill expect to bring huge savings to customers with smart grid technology. The question that remains is who will pay the bill? Cargill expects to cut electricity bills at its plant in Springdale Arkansas, where company handles about 50,000 turkeys a day, by $680,000 were electricity bills run $2 million a year. They expect that their bill by utilizing their own generators on high demand days.
The secret behind this money-saving plan lies in what’s known as the smart grid—a wholesale revamp of the system that distributes energy to homes and businesses around the country. Government bodies and utility providers are in the early stages of this multibillion-dollar upgrade to transform the existing grid into a two-way network where power and information flow in both directions between the utility and the customer, not just from the provider to the user. Done right, the revamp will cut bills, reduce consumption, give users more say in the kinds of energy they use, and even let customers produce their own energy and sell it back to power providers.
“What’s going to happen with the smart grid is that we’re going to create a network that’s larger than the Internet,” says Guido Jouret, chief technology officer for the emerging-technologies group at Cisco Systems (CSCO), one of the many companies working on the technology needed to modernize the electric grid.
A $20 Billion Market in Five Years
The Electric Power Research Institute, a nonprofit research and design group, estimates that it will cost $165 billion, or roughly $8 billion a year for 20 years, to create the smart grid. The market for the gear needed to overhaul smart-grid communications alone may reach $20 billion a year in five years, Cisco estimates. Other technology companies developing smart-grid software and hardware include IBM (IBM), Oracle (ORCL), Google (GOOG), and Siemens (SI).
The tech sector’s interest is fitting considering the similarities between the energy-grid upgrade and the computing revolution of the 1980s that saw hulking, centralized mainframes give way to PCs. The existing U.S. power grid dispenses electricity but is limited in its ability to gather intelligence from end users—hence the monthly visit from a meter reader. Now utilities are replacing outmoded meters with so-called smart meters that foster a back-and-forth between customer and utility. In much the same way PCs opened the door to third-party software and services and use of the Internet, smart meters are paving the way for tools and services that make the system more responsive to shifts in energy demands.
Cargill is counting on smart-grid tech to lower its bills. Many utility vendors set rates for industrial customers based on peak-use patterns. So in a common practice known as peak-shaving, Cargill taps its own generators to keep its 365,000-square-foot Springdale plant cool on summer’s hottest days rather than use energy from its electricity vendor, PowerSecure (POWR). The challenge is determining when peaks occur. PowerSecure keeps close tabs on Cargill’s generators, as well as fluctuating electricity prices, and when it can tell that rates are on course to pass certain preset thresholds, it fires up Cargill’s generators remotely.
Easier to Opt for Solar or Wind
In the future, Cargill may choose to run its generators more often and sell power back to the utility when prices are high, says PowerSecure CEO Sidney Hinton. While Cargill’s utility provider doesn’t currently purchase energy generated by customers, other utilities, including PG&E (PCG) in California, have begun buying solar energy generated by customers on corporate campuses and residential rooftops.
Another benefit is that customers may soon get more leeway in determining the nature of the power they purchase, more easily opting for renewable energies such as solar and wind, says Matthew Trevithick, a partner at venture capital firm Venrock I’m. Companies that are actively trying to cut their carbon footprints, such as Coca-Cola (KO), may be able to specify the percentage of renewable energy they buy, opting to pay more for wind, for example, if it helps them meet go-green targets.
But questions abound over who will foot the bill for the grid’s modernization. The American Recovery & Reinvestment Act has allocated $4.5 billion in grants and loans through the Energy Dept. for the smart grid to enhance security and to ensure reliability of the electric grid to meet growing demand.
What is of the remaining costs? Often, capital improvement expenses are passed along to customers. Before that, though, utilities need a green light from state regulators. “Certain states will go first because of cost,” says David Leeds, an analyst specializing in the smart grid for Greentech Media. For instance, he says that in California, electricity costs 15¢ per kilowatt hour, compared with about 5¢ in Georgia.
Discounts for Lower Peak Usage
California utilities are leading the way in smart-meter installation. Northern California’s PG&E is the leader, spending $2.2 billion to deploy 5.4 million smart meters, 
according to a Greentech Media report. Southern California Edison is No. 3, spending $1.63 billion on 4.8 million smart meters. (Columbus (Ohio)-based American Electric Power (AEP), with a goal of installing 5 million meters, lands between the two California utilities.)
Utilities stand to benefit from smarter-grid technology, too—particularly during high-demand periods. When demand for electricity exceeds supply, such as on hot summer days when air conditioners are running, utilities must find additional power or potentially face blackouts. Some are forced to tap expensive, natural gas-burning power plants that are kept for just such a purpose. Alternatively, utilities can buy power on demand from the spot market. The problem in either scenario is that rates charged for electricity remain constant even when the cost of supplying it can surge. As a result, utilities may lose money on hot days even though consumers are using more power.
Many utilities have encouraged consumers to voluntarily engage in energy efficiency, but changing consumer behavior can be challenging. For example, Southern California Edison has used the slogan “Give your appliances the afternoon off” for decades to try to get customers to reduce the strain on the grid from 2 p.m. to 7 p.m., when millions of customers turn on large appliances such as clothes washers and dishwashers. While energy-efficiency programs have helped reduce consumption, the utility stands to make even bigger gains with the installation of smart meters.
Plants Can Keep Going During Storms
But as information on usage is extended further to the residence or business, customers will be able to see just how much energy their lighting, air conditioning, and appliances use. “The idea is that electricity costs more at peak-demand times, so if you showed those pricing signals to people, they can choose to shift usage to off-peak times,” says Jeffrey Taft, global smart-grid chief architect at Accenture (ACN). The smart grid will also give utilities the ability to automatically turn down business and consumer appliances on peak days. Customers would probably be given some sort of discount in exchange for letting the utility cut power to certain systems at key times of the day.
In Springdale, Ark., the local utility once faced a high-demand day and called and asked Cargill to fire up its generators and separate from the grid—and paid the company to do so. “In the long run it netted out a lower cost for us,” says Cargill Engineering Manager Jim Edwards. Those generators have come in handy at other times, too. When there was a big ice storm in Northwest Arkansas this past winter, Cargill ran the generators for six days straight to keep producing turkey meat. “We were the only facility in this area to continue processing products,” says Edwards. “If the plant had been closed for those six days, it would have lost about $1.2 million.”
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My Take: This is great! However, the average person is going to worry about how much it will cost them especially if they are not able to return power to the utility company. I think it is fantastic that big businesses and utility companies are finally trying to go green. The problem that I see is that there are a lot of people who cannot afford solar panels or wind generators for their homes so that they can partake in this type of project.
Going green is always a good thing. It means that we are trying to save our planet as well as ourselves. But will it be enough to stop global warming? One thing is for sure, if we don’t stop global warming we are going to need more power to keep cool veneers goes tropical.
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Other Resources
06 Nov
Cited: Reuters
Wal-Mart stores Inc. is taking on the Geek Squad! They plan to offer a service that will help consumers set up electronics in their homes including computers that will challenge their rival Best Buy. The service started this month with privately held N.E.W. Customer Service Companies Inc. that is available through all of its US Wal-Mart stores just in time for the Christmas season.
Wal-Mart is undertaking the program through a third-party services provider N.E.W. Customer Service Companies, which recently began providing similar services at Wal-Mart’s Sam’s Club stores and has supplied Wal-Mart with warrantee programs for the last few years.
Shoppers can buy service plans on a prepaid card ranging from $99 to $339. The service spans help with basic television installation on the low end to setting up a home theater, wireless router network or a home office computer network. The service includes a preliminary consultation and a tutorial after installation is completed.
Consumer electronics retailers have been offering technology support to differentiate their business and cut down on the number of products, particularly flat-panel TVs that are returned after customers get the gadgets home but cannot use them properly.
Wal-Mart has been absent from providing consumer electronics services like these, which have become very popular with other consumer electronics retailers like Best Buy Co. (BBY), which runs its “Geek Squad” in-house. Best Buy said last month it would hire more staff for the U.S. holidays and was betting that services like its Geek Squad repair assistance would give it a further edge over rivals.
The retail giant will partner with product-support firm N.E.W. Customer Service Companies, the report said. By the holiday-shopping season, all U.S. Wal-Mart stores plan to offer customers the opportunity to use N.E.W.’s service in their homes. Reuters said the service already kicked off this month in specified locations.
Wal-Mart will give shoppers the option of buying service plans “on a prepaid card, ranging from $99 to $339,” Reuters said. The service plans will provide “basic television installation on the low end” to more advanced services like home-network or home-theater installation. Reuters said the plans include a “preliminary consultation and a tutorial after installation is completed.”
The decision to bring on a Geek Squad-like service seems to underlie Wal-Mart’s desire to become a major player in the electronics business. It may also solidify its position as Best Buy’s most dangerous brick-and-mortar competitor since the death of Circuit City and its FireDog in-home service.
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My Take: Well, I hope their services are just as good as the “Geek Squad”. Of course, if they are only offering installation type services, they are not going to make it. The “Geek Squad” offers more than just installation services. They also offer things like data recovery and virus removals/checks.
However, I am not sure how good the geek squad is at data recovery services. But I am sure that if they can probably help with the deleted hard disk recovery. That is, as long as a hard disk was not formatted after everything was deleted.
I do think that Wal-Mart is smart in offering installation services for the electronics they sell. If I was ever able to afford to purchase a plasma TV, I would probably request and installation service. As expensive as they are, I would probably really mess it up if I tried to do it myself.
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