The left-leaning public policy and consumer affairs group, Vermont Public Interest Research Group has spun off a nonprofit solar installation pilot project into a business.
The company, SunCommon, a so-called “benefit corporation,” installs residential solar systems.
Duane Peterson, president of the VPIRG board of trustees, and James Moore, former VPIRG Clean Energy Program director, started the company last fall after a VPIRG energy pilot program proved successful.
“It was a pilot project within the nonprofit,” Peterson said. “The tail started wagging the non-profit dog, and in order to make it available to all Vermonters, we really needed to increase the scale.”
That meant obtaining start-up money from private investors to fund the equipment and hiring a staff of 32 employees, including SunCommon workers and the contracted installer. At the launch, the company showed off a fleet of “environmentally correct” hybrid cars and an electric Chevy Volt, complete with a colorful paint job that includes the company’s logo. Peterson declined to name the investors.
VPIRG was tight-lipped last fall when VTDigger.org first caught wind of the plans for the formation of the company.
At a press event on Thursday, Mary Powell, the CEO of Green Mountain Power, and Gov. Peter Shumlin jumped on board to support the company.
Moore said consumers typically have to make a large up front investment in order to install solar systems. SunCommon leases the equipment with no upfront cost to the consumer. The financing system is similar to one developed by the Vermont company All Earth Renewables.
SunCommon takes advantage of a federal income tax credit, a state solar rebate and five years of accelerated depreciation.
“Most Vermonters aren’t used to paying for the next 20 years of power,” Moore said. “That’s essentially what the solar industry used to make people do. This is an easy monthly payment, and people will be paying less than they would be paying their electric company.”
The theory? Consumers will invest in solar installations that produce enough energy to “zero out” residential electric bills.
While SunCommon will guide homeowners through the installation process, it doesn’t make or install the panels. A California company, SunPower, manufactures the panels and a local business, Peck Electric, will do the installations.
SunCommon is one of a half dozen companies that is listed as a benefit corporation in Vermont.
A Vermont law that went into effect July 1, 2011, allows companies to incorporate as benefit corporations — meaning they must consider factors such as the environment, community or other social issues in making business decisions.
Ken Merritt, managing director of the law firm Merritt & Merritt & Moulton, helped the company incorporate. He said the benefit corporation model requires the business to take into account social objectives when making decisions. Benefit corporations define these objectives in their corporate charter. While there is no state evaluation requirement, Merritt said, benefit corporations have to publish a report that assesses their social mission.
Like a traditional corporation, benefit corporations have shareholders who can bring lawsuits against the company’s board of directors if it fails to fulfill its duties. The model does not open the company up to third-party lawsuits by “stakeholders” who would benefit from the company’s social mission, Merritt said.
Benefit corporations, Merritt said, are not the same as B Corps which are certified by a nonprofit organization called B Lab. The organization ensures companies meet social, environmental and accountability standards. SunCommon has yet to go through the B Corps certification, Merritt said.
Guy Page, communications director of the Vermont Energy Partnership, said in an email that the start-up is an intriguing project, but it faces challenges. The Vermont Energy Partnership represents groups that support keeping Vermont Yankee open as a form of low-cost baseload energy.
“The high cost of renewable power, and solar power in particular, is a serious limiting factor in its attractiveness as a large component in Vermont’s energy portfolio,” Page said. “Countries far advanced in small-scale intermittent renewable power, such as Germany, are finding that the problems of high cost and need for reliable baseload power persist. Vermont policy makers need to be asking serious questions about the economic advisability of pursuing an energy future that relies too heavily on intermittent renewable power.”
Correction: Due to an editing error, this post originally and incorrectly stated that SunCommon was a for-profit arm of VPIRG. The company is a separate entity.
