California plastics processors are seeking a variety of solutions to their continuing energy problems.
Roplast Industries Inc. of Oroville is installing a gas-fired cogeneration system to supply 80-90 percent of the film extruder's electricity, said President Robert Bateman. An investor-owned utility will provide the remainder. Bateman wants the equipment operational by May when peak summer rates begin.
Bateman projects rates will be ``somewhat down this year,'' reflecting the election-year political climate and falling gas prices.
The Society of the Plastics Industry Inc. is pressing Gov. Gray Davis to listen to processors' concerns, and about 70 processors in the area have written to Davis.
``We want an audience with the governor,'' said Frank Capolupo, director of SPI's Western Region in Irvine.
Plastics processing accounted for $24.2 billion of California-produced goods in 2000. Processors say that current regulations penalize facilities that must work on a 24-hour, seven- day schedule.
Some film extrusion firms ``are looking seriously at moving,'' said Norma Fox, executive director of the California Film Extruders and Converters Association in Newport Beach. CFECA leaders conveyed their concerns to Davis in August and continue to press state agencies, legislators and regulators for rate relief.
Meanwhile, economic developers from other areas are trying to lure away California processors.
At the start of the energy squeeze, Jatco Inc. of Union City, Calif., ``received letters from no less than 20 locales throughout the country, and they continue to come in,'' said Paul Appelblom, Jatco president and chief executive officer and national SPI vice chairman.
Jatco's power bill increased $500,000 during 2001. The injection molder had mixed results in passing along the surcharge to its customers.
Some believe the crisis is over, but Appelblom disagrees.
``We have a tremendous perceptual problem that the problem has been resolved,'' but there is ``no foreseeable adjustment at this point in time because of long-term bonds signed by the state,'' Appelblom said. ``I am frustrated, particularly by the naivete of people thinking it is over.''
Economic developers pursuing Montebello Plastics Inc. of Montebello, Calif., are ``emphasizing electricity,'' said President Timothy Guth.
The film extruder explored getting in-house distributive power but found systems relatively expensive, he said. Installing equipment represents ``a gamble [that] rates will stay sky high'' and might require three or four more employees.
``Our maintenance staff is stretched handling plastics processing equipment,'' Guth said.
Smooth-Bor Plastics of Laguna Hills, Calif., ``looked into alternatives - pumps, skylights, generators - to help us get through the crisis,'' said Al Bruder, quality manager. ``We reduced lighting, regulated electrical use [and for $20,000] updated an electrical panel.''
Smooth-Bor has maintained prices and absorbed energy costs. ``Luckily, resin prices have not gone up an extreme amount,'' Bruder said.
The privately held firm extrudes and injection molds resin for medical tubing and industrial, pool and vacuum hoses.
Some California operations seek a jurisdiction with a municipality-controlled utility, outside the rates of investor-owned utilities. Ten municipalities and an irrigation district offer such services.
Riverside public utilities department, for example, is dealing with several interested firms. Advanced Plastics Inc.'s AmericanMaid division moved from Corona last year, and Sabert Corp. of Sayreville, N.J., is building a West Coast facility in the area.
Other companies are offering energy studies and consultations, typically targeting plastics and food processing.
Suppliers include Chevron Energy Solutions LP in San Francisco and General Electric Co.'s GE Industrial Systems division in Plainville, Conn.
Engineering firm Cogeneration Partners LLC of Irvine, Calif., touts cogeneration as ideal for certain plastics processors. ``I have a program using exhaust heat for drying resin,'' said President Farhad Ghahremani.
New California cogeneration, solar and other alternative energy sources benefit from a state-funded program paying up to 30 percent of a project's installed cost.