Cool $30 million offered for better fridge

July 08, 1992|By New York Times News Service

Electric utilities are turning up the heat in search of a better refrigerator by offering a $30 million reward to the first company to build it.

A group of utilities that serve one-fifth of the households in the United States, including Baltimore Gas and Electric Co., announced the prize yesterday. The money would go to the developer of a refrigerator that would use 25 percent to 50 percent less electricity and no ozone-eating chlorofluorocarbons.

The utilities, often at the urging of government regulators, have been encouraging increased efficiency in electricity use, as a cheaper way to balance supply with demand.

The alternative is building more power plants and adding to pollution.

The prize, which the utilities are calling a "golden carrot," represents a new approach -- one that rewards manufacturers rather than consumers.

For the last few years several utilities have paid subsidies to consumers to stimulate sales of more efficient refrigerators, or // even quietly offered "incentives" to appliance store sales personnel to steer shoppers toward the more efficient models.

In offering the prize, "we're buying the production and delivery of super-efficient refrigerators into the service territories of the RTC participating utilities," said Gary B. Fernstrom, the supervisor of residential program development at Pacific Gas & Electric Co. and the chief financial officer of the utility consortium formed to administer the prize.

The 23 utilities, scattered across the United States but with strong representation in the Northeast and the Pacific Coast, serve about 20 million of the nation's 94 million households. More companies may join, swelling the $30 million jackpot.

The group asked for bids from manufacturers, due in October, and promised to pick two semifinalists in December who would build prototypes by next June.

The winner would be paid the $30 million as the refrigerators were delivered to appliance dealers; the number of refrigerators that the manufacturer promises to produce would be one of the details in the company's bid.

Members of the consortium met yesterday with representatives of refrigerator manufacturers in Chicago. As a result, manufacturing executives most directly involved were not available for comment.

Others said it was too soon to talk about whether the unusual approach, a "winner take all" prize, was a cost-effective way to improve the average efficiency of refrigerators.

But one expert, a senior engineering executive at a major manufacturer, said the plan could place the losers at a severe disadvantage.

The engineer, who declined to be named for fear of offending the utilities and hurting his company's chance at the prize, said:

"The research and development by one company is going to be funded by the utility companies. The rest of the industry will have to duplicate the product at some period in time, and everybody else is going to have to absorb those costs internally."

Refrigerators and freezers use about 20 percent of the nation's electricity, and vary widely in efficiency.

A typical 18-cubic-foot model delivered to a kitchen 20 years ago and still in use will consume 1,500 to 1,800 kilowatt-hours a year; the average model on the today's showroom floor uses about 900 kilowatt-hours, Mr. Fernstrom said. His goal is a refrigerator that will use only 400 to 500 kilowatt-hours annually.

If a customer replaced an 1,800-kilowatt-hour model with a 500-kilowatt-hour model, the utility could avoid burning two and a half barrels of oil a year, or 1,200 pounds of coal or 13,000 cubic feet of natural gas, and it would not need the power-plant capacity to burn them.

Higher efficiency does not require new inventions, engineers say, but the technical challenge is substantial nonetheless.

Some refrigerators on the market already exceed the 1993 standard for efficiency, but they use CFCs, whose production will be banned in this decade by international agreement, and whose use in new refrigerators is supposed to stop at the end of 1994.

One type of CFC, commonly known as Freon, is used in a refrigerator's compressor; another type is used to make the foam insulation. Substitutes exist, but they are not as efficient.

Discussing the conflicting goals of high efficiency and no CFCs, an executive at a major manufacturer said Tuesday, "there's a tug of war, and we're the rope."

James G. Powell, a spokesman for Maytag Corp. which produces Admiral, Maytag and Magic Chef models, said that more efficient machines were possible but that "it's important that the product be capable of being sold in the marketplace."

Appliance manufacturers say that they could improve efficiency by adding insulation but that they cannot change the exterior dimensions of the cabinet because most consumers shop for a machine that will fit in the space in an existing kitchen.

Models that use something other than Freon in the compressors may be noisier, too, engineers say.

But experts agree that significant improvements are possible without technical breakthroughs. As with high-efficiency air-conditioners, simply increasing the size of heat-diffusing panels would help.

And using the best available motors, even if they are more costly, would increase efficiency.

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