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Energy costs take a big bite out of your profits. These moves will save you money. And boost your green credibility, too

Frustrated by rising energy bills, Larry Tinkelman, president of Kevin's Wholesale, replaced 100 light fixtures in the company's Scranton (Pa.) warehouse with energy-efficient fluorescent units. That seemingly ho-hum fix saved $2,600 a year, so Tinkelman moved on to bigger things: installing a new heating system. The cost for the upgrade? About $23,000, after $15,000 in state rebates. But the 57-person, $6 million seller of decorated apparel and promotional items should knock about $5,600 off its gas and electric bill next year, and Tinkelman expects the savings to continue. "When you are running a business, you aren't focused on the little stuff," he says. "But it's not hard to see the investment is a good one."

With oil at about $90 a barrel as of early February and natural gas prices up about 37% since the beginning of 2007, small business owners are seeing their energy bills spike. Energy costs tied with health-care costs as the largest spending increases for small and midsize companies in the past two years, according to a November, 2007, IBM survey. Add to those worries the value of cultivating a green image among customers and there's plenty of incentive for small companies to rein in their energy use. Jerry Lawson, manager of the Environmental Protection Agency's Energy Star Small Business program, says companies can slash costs about 30% a year by improving lighting, heating, cooling, and office equipment.