Red tape snarls Carson City maker of co-gen systems

A generator that provides homeowners with cheaper electricity bills, hot water as a byproduct and doubles as a reliable emergency backup system in event of a power failure sounds like an easy sell.

It's been anything but, says Richard Langson, president of Vector CoGen, based in Carson City.

A sales goal of 20,000 units predicted two years back, became snarled in regulatory compliance with the Underwriter's Laboratory, a hurdle recently completed.

"Regulatory requirements in the United States are burdensome compared to other countries," Langson says.

Meanwhile, the company has found a market for the home power generators in Europe.

Last year Langson met a German distributor at the Florida PowerGen trade show.Next month Vector starts shipping 30 units a month to the European market.

In this country, sellers of solar energy or photovoltaic panels in California are targeted by the company as a potential pool of dealerships, says Langson.

California and not Nevada is the target market for units because that state mandates a 40 percent rebate to consumers who buy alternative energy systems.

Langson says he tried to get a similar bill passed during the last session of the Nevada Legislature, but it stalled in committee.

"Thomas Edison built a co-generator over 100 years ago, but it went nowhere due to fighting roadblocks put up by utilities and government.

There's a tremendous amount of regulatory paperwork at the state level.

Attempts get mired in red tape."

While wrestling regulations tangling the home-sized units, Langson did not let his four patents and thousands of hours of design work languish.He developed a mid-sized unit, designed to power buildings such as coin-operated laundries, convenience stores, small apartments and estate-sized homes.

James Robinson, director of business development, says cogeneration, known as combined heat and power, is the simultaneous production of environmentally-friendly power and thermal energy from one fuel input, usually natural gas.

Powered by natural gas or propane, the Vector unit uses an internal Kawasaki engine to spin a generator.Water that cools the engine, just as the radiator cools a car engine, is circulated through a heat exchanger, producing preheated water that is fed into a boiler or water heater.

The unit meets tough California air quality standards, says Robinson.

Another environmental plus:While a power plant releases heat into the atmosphere, the heat generated from the internal water cooling the Kawasaki engine goes to heat water for a building.

When it comes to cost, Robinson says customers using Vector units pay 20 to 50 percent less than they would pay a utility company.

The payback period could be less than four years.

He estimates Californians who pay electric costs of 13 to 14 cents per kilowatt hour will pay 8 to 10 cents per kilowatt hour when generating their own power with a Vector unit.

Actual savings depend on the price of the natural gas purchased to run the unit.Nevadans pay about 8 to 12 cents per kilowatt hour, he says.

The Vector unit is sold exclusively through distributors.

Unit cost varies, depending on complexity of the installation, falling in the rage of $37,000 to $45,000 per unit.With an expected life of 10 years or more, the unit is guaranteed for 20 years, and the engine for 20,000 hours between overhauls, says Robinson.

The unit's noise level is about 52 decibels, muffled by a double-walled water jacket.

The smaller home-sized units, being air-cooled, run at 59 decibels, the noise level of a home air conditioner.

Most cogeneration equipment today is aimed at large industrial customers, those in the 75- to 500-kilowatt range.Nobody but Vector serves the lower end of the market, those needing 15-kilowatt units, says Robinson.

In fact, he says,"The vast majority of people have never heard the term cogeneration." The business plan is to take the market one industry segment at a time."Interest from apartment owners is tremendous," says Robinson.He plans to start with a sample multi-family facility and use that as a springboard to educate that market.

The first install is in San Jose.

"People want to know: is it going to save me money?"Robinson says."We show them numbers using the energy consumption statistics that utilities make available on the Web."

Owned by founder Langson, privately held Vector CoGen is funded by shareholders and investors.

The company is looking for more investors.Metal Solutions in Mound House handles unit assembly and cabinet manufacturing.