SOUTH GATE — When this city tried to form its own electric utility earlier this year, it swapped harsh words with Southern California Edison Co. But last week, the words were all sweetness and light as the utility gave the city an early Christmas present.
To show that Edison is no longer "mad," as one official put it, the company offered the city an estimated $30,000 saving on its electric bill. The City Council unanimously accepted.
The gift comes in the form of an Edison proposal to bear most of the cost of installing electric heat pumps in the South Gate Park Sports Center, which has an indoor Olympic-size swimming pool. The equipment will warm the water in the center's pool, Jacuzzi and gymnasium showers, while it cools other areas of the complex.
It will cost Edison nearly $70,000 to install 10 heat pumps, while the city pays about $7,500 for materials and equipment.
It now costs about $65,000 annually to operate gas-burning heaters for the year-round pool and sports center. That expense is expected to be cut approximately in half with the installation of the more efficient heat pumps, according to Rollie Berry, city director of public works.
"It is a good deal for us. After our bitter struggle, things have gone well. It is a good relationship," Mayor Henry C. Gonzalez said.
Larry Fine, district manager for Edison, agreed. Referring to the city's attempt last summer to shove Edison out of business in South Gate, Fine said: "After we finished that little problem with the city, we wanted to show we weren't mad."
Edison spent more than $25,000, mostly in postage, to alert its 23,000 residential, industrial and commercial customers to the city's attempted takeover that began in August.
After a stormy public hearing in September and thousands of letters sent to City Hall protesting the takeover, the council decided to drop the idea.
The city had contended that by going into the electric business, South Gate would raise money to replace about $1.2 million in lost federal revenue-sharing funds. The money would pay for such city services as police protection and recreational activities. Officials argued that the city could run the system more cheaply and pass on some savings to customers.
During the fight, Fine said, the company realized the city had genuine financial problems and "we wanted to help."
In November, the company approached the city about conducting a series of surveys that would look at ways to save energy costs, Fine said. Edison found that the most cost-effective saving would be in the pool and sports center area.
Fine said Edison looks at the installation of the heat pumps as "sort of a pilot project" for E. Tech. California, the Los Angeles company that will install the new equipment.
The company has installed the pumps in smaller pool facilities in the state, but the South Gate complex is the largest. If it works there, Fine said, everyone will benefit.
"We are not entirely unselfish in this. If the pumps save the city money, in the long run Edison will make money. E. Tech will sell a lot more electrical pumps and we will sell a lot more electricity," Fine said.
The pumps can operate at a lower cost than gas heaters because they circulate the heat rather than create it, according to Paul Mechler, western regional manager of E. Tech.
The pumps take existing natural heat from the air and use the warm air to heat the water, Mechler said. A byproduct of the system is cool air, which is harnessed to produce air conditioning, said Vasant Agarwal, president of E. Tech.
E. Tech. has about 20,000 systems throughout the nation that heat water in hotels, restaurants, commercial laundries and residential pools, Agarwal said.
The pumps will be installed early next year, said Bruce Spragg, city administrator. He said the city has not decided what it will do with the projected savings.
"This is not a savior for all of our (financial) problems but it will help. We have lots of needs. We will find ways to use the money," Spragg said.
And just in case the electric pumps do not work out, the city does not intend to get rid of the gas heaters, Spragg said.
"If it does not work, we can go back to the old stuff," he said.