On the baseball field, this essential — although often overlooked — teammate is called a utility player. In the site selection game, it's the utility company that fills that role.
“One phone call to a utility economic developer connects a business with timely, detailed information on crucial location issues," said Cindy Marzofka, executive director of the Utility Economic Development Association. "Utilities confidentially gather customized information, connect with decision-makers and help cut through red tape to expedite the process. They can provide insights into which communities have the best assets and resources to match a company’s needs, and which areas will be most receptive to welcoming a particular type of business.”
Many utilities deliver confidential, customized research to their clients that go well beyond basic demographics.
"Often, utilities can provide the specific type of suppliers in a region, the certain type of graduates and the specific resources that are available to help a business choose the right place to grow and thrive," Marzofka said.
This information is likely distributed through a utility's economic development department, which provides site selection and information services for new and expanding businesses.
Don Bernhard, manager of community and economic development for PPL Electric Utilities in Allentown, Pa., said the primary advantage of dealing with a utility economic development program is that it can provide objective perspective on data for an entire region.
"And we're making that information available in increasingly sophisticated and easy-to-use ways," he said.
PPL's Web site combines an extensive regional site database with data in the International Economic Development Council's standardized format. Site selectors can use Geographic Information System (GIS) technology to sort through information on potential locations.
Bob Forsblom, economic development director for Buckeye Power in Columbus, Ohio, said his organization keeps a similar set of data.
"We're one-stop shopping," Forsblom said. "We maintain a list of sites and buildings that we update almost daily. And if we can't serve a client, we can turn them over to a utility that can. Our goal is to keep the company in Ohio, first. And then to keep them within the area for our work force."
Some of the services Buckeye Power offers, free of charge, to potential clients are comprehensive site and building portfolios, preliminary site studies, site search tours, assistance in structuring financial packages, electric energy audits, electric rate analysis, low-interest finances, construction cost analysis and preliminary supplier/market analysis.
In addition to asking about these services in your site search, there are some other hot topics you’ll want to discuss with your utility representative, including:
Reliability
When you walk into a room and flip the switch, you expect the lights to come on. If they don't, you assume there's something wrong with the bulb. That's because the interruption of basic utility services is rare.
But in an increasingly competitive business environment, reliable utilities are essential. Whether it's lost product, decreased production or an inability to communicate, even a momentary loss of power hurts the bottom line.
"Obviously, it remains important to talk to a utility concerning service, capacity and reliability issues," Bernhard said. "Increasingly, many business are high technology, or the equipment they use is, and companies or consultants analyzing a site may wish to ask for the interruption statistics for the line that will serve the site."
Price
For many companies, this is still the top priority. But there's more to it than just finding out the basic rates (peak vs. off-peak) and whether the utility offers rate reductions for particular high-usage customers or specific industries.
Additionally, ask about the price of land, buildings and transportation to the site. Plus, what other costs could arise down the line? For example, how does the utility handle extension costs? In some areas, that burden falls solely on the business. In others, the utility and the company share the costs. Know what plan is in place before you complete the selection process.
Skilled work force
Most utility representatives can go well beyond basic government census data. Ask whether the local work force is trained to meet the specific needs of your industry. Find out typical labor costs and whether state or local agencies provide work force-training incentives. Plus, are tax credits available for creating new jobs?
Service capacity
If you are a major manufacturer, you're going to require a large amount of power to keep your company running. Therefore, it's important to know what nearby manufacturers could impact the reliability of service. Is there enough capacity to handle everyone's needs? If not, how are service upgrades handled? What is the time frame and cost of expanding service? Are there any current plans to expand capacity?
Electricity Production
In addition to many different distribution methods, electricity can also be generated in a variety of ways, with differing costs. Because feedstock for nuclear power and coal is easier to maintain, Forsblom said prices for those processes are more controlled. But for electricity generated through the burning of gas or fuel oils, the market has been volatile.
"Natural gas prices have been up and down like a roller coaster the past several years," he said.
Green Power
Wildly fluctuating fuel prices have many communities seeking to increase the amount of green power used in their areas. Green power is electricity generated from natural sources such as wind, sun or methane gas produced by decaying garbage in landfills. Often, there is an additional cost up front, but in areas with fixed prices in place for green power, this investment could pay off in the long term.
For example, Austin Energy began its GreenChoice program in 2000 and now supplies more than 6,700 customers with green power. Residential and business customers near the Texas capital have the option of replacing the standard fuel charge on their bill with the GreenChoice charge of 2.85 cents per kilowatt-hour. While the current standard fuel charge of 2.68 cents per kilowatt-hour could increase, the GreenChoice power charge will remain fixed for 10 years.
Deregulation
While it's not the vitally important issue it was two or three years ago, the restructuring of the electric industry is still a topic worth delving into, especially in states like Texas, Ohio and New Jersey where deregulation continues to make headlines.
"Deregulation is the driver of many situations in considering a site," Bernhard said. "The most obvious is that in a deregulated state, it is necessary to analyze the success of the deregulated structure and project where the market in that state, under that structure, is going. That is particularly important since it is that market that will define what ‘deals’ a potential new customer will receive."
Other Environmental Issues
Because utilities themselves must keep up-to-date on the latest local environmental guidelines, they can be an invaluable resource for determining how these regulations might impact a potential new business in the area.