Zimmerman Diary has been operating in Arizona for nearly 90 years, but its long-lasting success doesn’t mean its third-generation owners haven’t had to innovate to survive along the way.
Facing rising costs, in March 2011 the Zimmermans installed a shiny new fixture they say will enable them to continue to stay in business regardless of electricity rates.
Dairy owner Bill and his wife Vicki had hoped to pass the farm, which was founded in Scottsdale in 1923 by Bill’s great-grandfather, to their son. But the couple was concerned that the rising cost of utilities and the stagnant price of milk would cause the operation to go under before it reached a fourth generation.
The 1,200-cow dairy, now located in Queen Creek, was paying $4,200-a- month to power the farm’s milking stations and wells. Despite the rising price of electricity, the Zimmermans said they couldn’t increase their milk prices to compensate for fear of becoming less competitive.
“In the past five years, utility electric rates have doubled, but the milk prices stayed the same. How does a dairy farmer stay in business?” said Victor Orlowski, president of Professional Engineers for the Diary Industry.
Orlowski said he has seen many small farms die off because off escalating energy costs. He approached the Zimmermans and told them they could effectively eliminate their biggest problem by installing solar panels to power their dairy, which would result in a very small electricity bill.
“And they said, you’re nuts, get out of here, you’re a snake oil salesman,” Orlowski said.
But Orlowski had an ace up his sleeve to convince the Zimmermans. He told them about a United States Department of Agriculture program that provides grants and loans to rural small businesses to help them install technology to use renewable energy.
“We were just trying to figure a way to keep our electric rates even, and when they came up with a project with the number … we got together, we could afford it,” Bill said.
The USDA Renewable Energy for America Program (REAP) gave the Zimmermans a grant for nearly $337,000 to start their solar venture.
Although the grant paid for just a quarter of the cost to erect solar panels on a two-acre parcel of the dairy, the Zimmermans combined it with subsidies from Salt River Project and other low interest loans to start the construction.
The solar installation cost $1.4 million to build. After their first year, the Zimmermans said they are saving $50,400 per year in energy costs for the entire farm.
The solar panels produce 443,000 kilowatt hours of electricity per year, about the same amount of energy 30 households consume in one year, which goes to power the milking parlor and the farm’s wells.
The panels sometimes produce excess energy, which goes back to SRP through a net metering program and gives the Zimmermans credit toward their electricity bill.
The success with their solar energy use convinced the Zimmermans to become advocates for alternative energy on farms.
“I just think it’s a wonderful thing and I would like to do another one,” Vicki said. “I would really like all the other dairies to be able to do it as well.”
Bill said he’s been to other farms in the area to try to convince their owners to install solar panels.
“It’s sustainable but it also keeps you in business. It’s getting kind of tight for farmers to stay in business,” Bill said.
Vicki said there are many variables that contribute to success or failure in farming, but she knows one they don’t have to worry about anymore is the unpredictable cost of energy.
“You know, there’s all kinds of layers, but this layer seems to be taken care of,” Vicki said.
“(The solar panels) will help this dairy remain competitive and producing jobs for many years,” said Alan Stephens, state director of USDA Rural Development for Arizona.