Local First Utah Op-Ed

Local First Utah’s blog often focuses on the human energy that propels our independent business community. But today I’m going to switch entrepreneurship for concrete kilowatts. You see, Utah’s energy system has some problems. Two of the gravest—air pollution and rapidly rising prices— have local solutions.

In January this year, The Salt Lake Tribune alerted consumers to the grim reality of rising energy rates because, quite frankly, we’re using a lot more of it: “Due to what it describes as the rising demand for electricity throughout the state, the utility warns Utah consumers may see annual price increases of 8 percent to 10 percent annually for the next decade.” This year, rates will only increase by 4.7%, a reduction of the power company’s initial request, but a reduction that suggests Rocky Mountain Power will be back before the Public Service Commission next year asking again for another hike.

It seems that as long as our energy needs keep rising we’ll have no choice but to pay the higher rates. But alternative energy proponents disagree, believing that as long as we’re investing more in energy now, it should be in sources that will continue to generate energy for the long haul. That, rather than gradually paying more for “traditional” and ultimately finite sources—sources that are, arguably, much more harmful to our health.

So, what…are we talking about solar panels on our roofs? We just might be. We just might be. But that idea is only part of the equation, which, it turns out, is literally what we are talking about: an equation. In fact, the equation is a series of integrated calculations that maximizes energy inputs from renewable energy sources at the moment of their peak generation that is designed, eventually, to largely or completely offset dependence upon coal and natural gas.

“One of the biggest arguments against renewable energy,” notes HEAL Utah’s Energy Analyst Arthur Morris, “is that it is intermittent and therefore cannot be predicted and therefore cannot be integrated. But Morris says we can look at meteorology as a useful comparison. “Everyone knows you can (to an extent) predict the weather. Is it perfect? No. But it’s a damn fine ballpark.” The equation forecasts both energy needs and energy generation.

Look, we’re paying more for energy—even self-styled “cheap” fossil fuels. That’s a reality. We will continue to pay more as long as alternatives aren’t developed. Investment in alternative energy can ensure that some of those most vulnerable to constantly increasing rates—small businesses—can remain sustainable for the long term.

That’s Local First Utah’s mission to the core.

In Search of Innovation

But please note: the following opinion does not necessarily reflect that of Local First Utah or its sponsors. The ideas are, however, concerned with protecting the public health of Utah’s citizens through responsible, local energy development.

Embedded, traditional energy structures have effectively maintained status quo by delivering what had been for a long time the lowest-cost energy on the market. Improvements in technologies harnessing alternatives sources, including wind, solar, and geothermal are beginning to level the playing field—and they avoid external costs (those not factored into the projected rates) of public health.

In short, think of all those “red alert” air days in Northern Utah during which it is recommended that children, the elderly, people with autoimmune disorders, and anyone who cares about breathing stay inside.

The fact is we have some of the worst air in the nation. As Utah Department of Environmental Quality points out, our winter inversions cannot be prevented, but the pollution that gets trapped in the valley and in our lungs can. While surrounding western states such as Colorado and California have legislated tough renewable energy standards, Utah is lagging behind, in spite of the impacts of our dependence upon fossil fuels on our health.

I have blogged before about local energy. Remember Moab? “The localization movement encompasses more than just food production. Moab (for example) is already harnessing healthier, renewable energy in the form of wind, a commitment that earned the city the distinction of being the Nation's First EPA Green Power Community.”

States generate (and often export) energy from a variety of energy sources, including both traditional fossil fuel-based energy and more modern, renewable sources. While a number of states have legislated renewable portfolio standards (RPSs), Utah has simply established renewable energy goals.

Utah’s code “requires that utilities only need to pursue renewable energy to the extent that it is ‘cost-effective’ to do so” based upon an “assessment of whether acquisition of the resource will result in the delivery of electricity at the lowest reasonable cost, as well as an assessment of long-term and short-term impacts, risks, reliability, financial impacts on the affected utility, and other factors determined by the Utah Public Service Commission (PSC).” The idea is to ensure Utah ratepayers are given the lowest cost, lowest risk energy. While the short-term low cost of fossil fuels is appealing, the elevated rate of environmental illnesses in our children is not.

The Local Solution: Wherever Local Is

There are several entrepreneurs and independent business owners working locally to develop and manufacture energy that can help nurture a transition to cleaner, safer, more local energy. But it will take an investment by people and local government to ensure their viability and competitiveness in a market flooded with cheaper products from abroad. Local energy production should ideally combine domestic manufacturing with renewable, localized, and readily available sources. Even the conversation about building costly twin nuclear power reactors in Green River is troubling in part because the power is likely destined to leave Utah, doing nothing to ensure Utah's energy independence. Meanwhile, the recent conversation about reducing our dependence upon foreign oil has turned our focus to domestic natural gas and, more recently, controversial oil "tar" sands from Canada.

We can do better.

An expert in air pollution and a leader in renewable energy development says he has the answer to powering the future world’s energy needs using only renewable sources. He is Stanford professor Dr. Mark Jacobson, and he will be visiting Utah on November 15th to discuss his plan for a safer, cleaner, and independent energy future. Dr. Jacobson will be visiting in conjunction with a fundraiser for a local nonprofit that has led grassroots efforts to keep foreign and excessive radioactive waste out of Utah—and which is looking to the future of Utah by supporting research that improves the health and integrity of our state through thoughtful, local development.

The same brand of initiative and ingenuity that define America—or better still, the sheer industriousness of Utahns—will power our future. Indeed, these ideas are not so big a shift from this blog’s core after all. It’s energy entrepreneurship driven by human entrepreneurship. They’re ideas that, in the long term, protect and empower independent businesses in our great state.

A quick diversion from southern Utah is in order whilst I sift through hours of tape and pages of notes to better distill that experience into briefer, easier-to-digest posts. In the meantime, here's a tale of deliberately choosing local:

It’s worth reiterating a point from Local First’s mission statement: “we are not anti-chain, we recognize that there’s room for all types of business in any thriving community. But we also know instinctively that, since local business owners live here, do their hiring here, operate their stores and offices here, buy most of their supplies and products here, pay all their taxes here, and spend their profits here, they obviously contribute far more to our local economies than do chains.”

And yet, driving by a chain restaurant this evening, seeing a group waiting outside for a table, I couldn’t help but wonder: “Why would one wait for that?” What is it about the canned, recreated chain experience that is worth waiting for? One can argue that consistency is a guarantee with the products of large corporations.

Some days, consistency is, indeed, a virtue.

But when it comes to dining out, there are so many great local options delivered by passionate people, it has become increasingly more difficult to accept meeting a group of friends or coworkers at a chain for whatever reason, when I know I can be spending my meager income on a restaurant that I know directly supports the local economy (or better still, directly supports a local farmer). And, the proliferation of online consumer review websites has helped arm the public with a system to hold all service industries accountable in the same way corporate secret shoppers and customer surveys are meant to ensure the delivery of a consistent product.

Tonight’s example does a lot of one, and a little of the other. The Pub Group (Desert Edge Brewery, Stella, Red Butte Café, and Martine) has some passionate, well informed people who do their best not only to support local agriculture, but to nurture the local economy.

(Incidentally, the team from Local First Utah also recently choose Desert Edge for its post-Neighborhood Business Conference meeting with the city staff and interns who helped organize the event, and thanks are hereby shouted out to Trina and the rest of The Pub staff who made our rather large group feel very welcome! And by the way, things are already looking good for next year’s conference! Please let us know if you have any other input about the 2^nd annual.)

Now, thanks to challenging liquor laws, only major national and international brewers compete for draught space at restaurants and bars (renowned smaller breweries won’t ship to Utah because of the 3.2 ABV limit on draught beers), meaning that next to the Budweisers of the world are only local draught beers. At the Desert Edge at Trolley Square, commonly known as “The Pub,” the proclamation “3.2 and Proud” adorns both the servers shirt and the wall. That’s a local brewery embracing the challenges and making the most of limitations.

Many have said that the alcohol limitations imposed by state law have forced brewers to be better at their craft, unable to cover flaws with higher alcohol. It’s worth mentioning.

Meanwhile, supporting the Pub Group in some cases means supporting local farmers, and always means supporting the local economy by ensuring much more of every dollar spent stays in the local economy. In all cases of the Pub Group, it means better food that isn’t prepackaged and prearranged to ensure the same meal is served the same way at every restaurant across America. It is then packaged and presented in a way to feel authentic, but it isn’t. It’s an outdated mode of the American dining experience rooted in the novelty of convenient, yet highly processed food that comes out of a box and is meant to make our lives easier by eradicating the drudgery of cooking—at the expense of health and real flavor.

Oh, and one need not enjoy beer to patronize Desert Edge, or any of the “Pub” Group restaurants.  One need only appreciate locally crafted food, good service, and the sense of community that only comes with locally owned businesses.

But you’ve heard that one before.

Author! Author!: Andrew Dash Gillman

Day 1: Moab and a Visit with Mayor Dave Sakrison

Enter an alleyway next to the place called Overlook, walk down toward a brightly colored building but not as far as the trailer. Last door on the right. In a bigger city, such dubious directions might have dissuaded a more cowardly crew. And standing in front of that alley, it was even less welcoming. But this was Moab, so we walked down the sandy road until the three fellows, two sans shirt, sized us up and inquired after our intentions.

But more on that later. Welcome to the first day, in depth. If you missed the introduction and feel totally, totally lost, here's the introduction.

The story presently finds us in the Village Market speaking with store manager Kevin Washburn. Local First Utah Statewide Coordinator Matt Monson had summoned the gentleman because of his mission to gather information, or “fact-find.”

Indeed, Mr. Monson had hoped to spend as much time listening as speaking. In the past, Local First had visited Southern Utah towns intent on spreading the word about Local First and our message with the specific focus of signing up partners.

An educational nonprofit by definition, when Local First Utah visits Utah’s many unique towns and communities it is always with the intention of strengthening the statewide network through conversation and communication. The conversation is about partners helping partners and consumers that make the local shift as well as encouraging local governments to level the playing field to help small business owners be competitive.

So what’s the story in Moab these days?

Well, Mr. Washburn notes that “there used to be a lot more out of city shopping before the economic downturn and gas prices.” He finds fewer people are leaving town for goods because their prices aren’t that different from the big box stores in, say, Grand Junction, some two hours away. And that is not to mention the Village Market has focused on supporting local producers ranging from Moab Ice to Castle Valley goat’s milk products and farmer-direct producer during the summer.

The challenge is that Moab doesn’t have everything that residents need. That sentiment would later be echoed by Mayor Dave Sakrison and the city’s economic development director, Ken Davies.

Washburn identifies a misperception about conditions in Moab: “People think we live in God’s country and that we must have died and gone to heaven to work and live here but we live in poverty.”

As for the needs of the residents, aside from a few necessities, the town is limited to the Moab-themed memorabilia reserved for tourists. It is because of the focus on seasonality tourism that many residents go on unemployment during the offseason, which raises a question about the year-round sustainability of the community. How can Moab develop a thriving, sustainable local economy, when the economy is primarily driven by tourists during the tourist season? It’s a tough question, and possibly not one with answers.

In search of answers, no better people to talk to than the Mayor and his Economic Development Director, eh?

Aye.

The Meeting

On time for our scheduled meeting, we parked near the intersection of Main and Center and perambulated east. Yes, we actually perambulated, as opposed to merely walked. We were on a mission.

The corner office of Moab’s city building was open and Mr. Davies and Mayor Sakrison were waiting, a glass bowl of miscellaneous and individually wrapped candies center-pieced (that’s a verb now) on the coffee table.

The team in the mayor’s office immediately expressed support of the mission of Local First Utah, recognizing that it is “a good idea,” but not entirely certain how best to implement the brand to have the greatest effect in their unique community. And unique it is. To be clear, “Grand County has only 9,000 people, and 8,000 live here in the valley, including 5,000 in [Moab]…”

That, Mr. Davies observes, means “It’s a fairly small market with other economic forces at work,” namely not having a large enough market to make viable the businesses that sell the more everyday things that average consumers may need.

“So we have to find what markets [and products] local businesses can carry to be price-competitive enough that it’s the same or close to the same...” In other words, the city of Moab and Grand County in general needs to identify what businesses can work there, and focus on capturing that share of the market while recognizing that they will always have to leave town for some things. It’s true anywhere, but in a town like Moab, it would be nice to isolate some of the bare necessities (or “Bear Necessities,” if you’re so inclined) that are missing and find a way to make them work locally.

The reason is simple: “People want to support local economies. They really do,” notes Mayor Sakrison. “That’s what makes Moab so unique.” Not having the large merchants is part of the cultural fabric that defines Moab, but it also severely limits the local economy’s reach.

Matt can’t help but ask whether the Wal-Mart battle has been fought in Grand County, and indeed it had—to an extent. But the larger battle may be internal: “This is a community without consensus,” Mr. Davies says, so he believes the focus should be on how the money recirculates.

Local First veterans are very familiar with the multiplier effect that shows how much more money (3.2 times more!) stays local when money is spent at a locally owned, independent business versus at a chain. If you’re new to Local First and reading this blog out of curiosity or the sheer love of blogs, then take note: We’re talking three times more money recirculating locally from money spent at local businesses because those business owners are more likely to support other local businesses and more of the tax revenue generated stays in the state.

That’s the big positive, if not the biggest, and one of our most favoritest. We don’t want to dwell on the negative. In fact, you might say we wish to eliminate the negative while accentuating the positive. That’s Local First Utah at its finest.

But at the end of the day, you can’t expect consumers to pay twice as much for something. That’s a fact. But another fact? The perception of price inflation at locally owned, small businesses isn’t really accurate. Some things may cost a little more, okay, but that cost is frequently offset by other factors, including the obvious travel time and gas prices. But other studies are emerging that show larger retailers often lure consumers in with underpriced items with the hope of luring them into shopping around, and maybe leaving with several additional items they weren’t planning on getting.

It’s fascinating consumer psychology at work, indeed, but it also raises questions: how much should something cost? The eggs at the supermarket versus farm-fresh eggs at the Farmers Market is one of the clearest-cut examples. When you know how the eggs are produced and their cost is subsidized at the supermarket, you don’t want to spend so little on them. (Not to mention the difference in taste. Okay, it’s mentioned. $0.99 eggs are terrible.) But these questions can occupy a great deal of space, and are, perhaps, better left to the philosophers. For our sake, we just want to support our friends and neighbors in their endeavors, their small businesses, and their lives.

For former small-business owner Matt Monson, it’s clear:  “Local ownership means local involvement.” That means looking at the net input of a business into the community, and recognizing how those communities are interacting to maximize what is already working while nurturing growth within them. Mr. Davies sees actual meetings of business owners as the best course of action to help nurture the Local First message. With or without community meetings, the idea still raised the question, “What can Local First do?”

Local First at Work

Everyone agreed the message is best served through continual reinforcement in the form of direct outreach. It also means looking for ways to reframe the argument: “There’s only so many ways you can say ‘local’ and ‘community’ before you run out of adjectives,” laughs Monson. Regardless, the Mayor supports tangible street campaigns that show the benefits of the Local First philosophy in order to empower business owners without seeming pushy. People should do it because they want to. Luckily, that was the plan.

But what does it mean for business owners?

Well, Local First works to identify key challenges determining business and consumer behavior. If a product, let us say, tires, are available locally, why should a consumer choose to support a local provider instead of driving somewhere where the price may be a little cheaper but the service totally remote? The answer is that price shouldn’t be the only incentive. The responsibility falls in the hands of business owners to provide exceptional service. In other words, says Mr. Davies, “You can offset any local price increase with an increase in service and response and recognition that you know the person you’re buying from.” In a town where people make on average $15,000 less at a comparable job in a larger city, that kind of community is critical to survival. Indeed, it promotes a rather active, underground trade economy which is great for small businesses. It’s definitive of small towns, and an older-model economy.

Whew.

That was quite a conversation. Perhaps in his determination to gather information and listen, Matt got more than he bargained for. Or maybe he got exactly what he needed. The next leg or our journey was exactly what the Mayor and Mr. Davies sought: an active ground campaign, door-to-door. We would be limited only by time and the encroaching holiday business traffic. But despite those limitations, we were encouraged to see Local First Utah undeniably had a definitive presence in the seat of Grand County.

The question was, in a tourist economy, what impact could a Local First organization have?

Author and Photos: Andrew Dash Gillman