A possible shortage of diesel generators could add to the electricity woes of Orange County companies that have yet to prepare themselves for the summer months, according to area suppliers.
The region’s diesel generator suppliers say they are seeing huge order backlogs and doubt manufacturers will be able to meet demand this summer.
“We’re all out,” said Yale Swafford, rental manager at Cummins-Onan Cal Pacific in Irvine, a dealer for diesel generators that Columbus, Ind.-based Cummins Inc. assembles at its Minneapolis plant.
Cummins-Onan Cal Pacific has a $7 million backlog of generator orders from about 50 companies, according to Swafford.
Generator maker Cummins pushed up production by 30% and now is finishing assembly of 75 generators each day. Its original forecasts had targeted production at 56 units per day, according to company spokesman Jerry Barton. Cummins officials check order levels every two weeks and are ready to step up production even further, Barton said.
“We’re seeing a shortage already,” said Kurt Klug, president and chief executive of Newport Beach-based Horizon Pacific, a generator supplier. “One company I talked with sent out 14 proposals to get one generator,and we haven’t even yet had rolling blackouts on a regular basis.”
The recent mild weather has helped keep electricity consumption in Southern California below levels forecast by the California Independent System Operator. But that same cool weather is encouraging some OC companies to put off a decision on whether to buy a generator.
“We have a lot of prospective customers just waiting to see what happens before they put an order in,” said Jayme Boden, rental manager at a Johnson Power Systems, a Riverside distributor of diesel generators.
Johnson rents and sells generators made by Peoria, Ill.-based Caterpillar Inc. to companies in OC and the Inland Empire.
“Once the rentals are gone, a company would have to wait three months after putting in a purchase order before a generator would arrive for them,” Boden said.
Johnson last week had a 20-customer backlog, Boden said.
“The summer’s going to be crazy,” said Jason Wondolleck, rental coordinator at Johnson. “The generators we order from Caterpillar are gone for rental within a week after they arrive.”
Generator suppliers say they’re just waiting for the first triple-digit-temperature day.
“If the temperature topped 105 degrees right now, we would have an onslaught of phone calls and wouldn’t be able to keep up,” Boden said.
It takes Caterpillar Inc. about a week to fully assemble a finished generator at its Peoria, Ill., plant Boden said.
“The summer could get really ugly,” said Horizon Pacific’s Klug. “A lot of companies are handcuffed by management positions, so they’re going to be left with no choice but to roll with the punches once the weather heats up.”
Klug said that many around-the-clock manufacturers cannot get quick approval from management for either the purchase or rental of generators, especially if company headquarters are out of state.
“When the blackouts start really occurring with the predicted frequency, they will react in a panic mode to acquire generators,” Klug said. “By the time this happens, most of the larger generators will be gone from the region.” n
