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In 2006, John Berger founded Standard Renewable Energy to help homeowners, businesses and government better understand how to incorporate clean energy solutions. The company made $ 1.1 million in revenues in its first year. Just three years later, it is forecast to make $109 million. During today's OnPoint, Berger discusses the state of the renewable energy industry in the midst of the current economic downturn. He talks about the "green collar" jobs market and gives his take on energy legislation making its way through Congress.
Monica Trauzzi: Welcome to the show. I'm Monica Trauzzi. Joining me today is John Berger, CEO of Standard Renewable Energy. John, thanks for coming on the show.
John Berger: Thank you for having me.
Monica Trauzzi: John, your company was founded in 2006 to help homeowners, businesses, and government better understand how they can incorporate and implement clean energy solutions. How has the discussion on renewable energy shifted since you first started your business over the last couple of years?
John Berger: Well, I would say there's a tremendous shift. You can look at the industry now and a lot of folks within the industry, the global energy industry is what I'm referring to, now recognize that renewable energy will take a place and probably recognize that it's going to be a bigger place within the energy industry than they had expected, say in 2006. I would obviously point out that the election of the Obama administration, of President Obama and including the now Democratic-controlled Congress in November was another step function change. And so just in the last few months there's been a tremendous amount of as you would call it a shift change in the energy business with regards to renewable energy and energy efficiency.
Monica Trauzzi: So there's this big focus on renewable energy, but we also have this big economic downturn. What are some of the biggest challenges you have encountered as result of the economic recession?
John Berger: I think often things are a double-edged sword and the answer lies in the middle rather than on either end of the spectrum. And the recession, depression, whatever we're in, I personally believe we're coming out of it at this point in time and have been for the last few weeks. But it's been a double-edged sword. On one hand you would imagine that people do not have as much credit to buy solar panels and high-efficiency air conditioning and insulation that you need to do to actually have energy efficiency and renewable energy. But at the same time, oddly enough, there's been a tremendous amount of credit extended in our sector. In fact, we set up SRE Finance to finance our customers in the depths of whatever this is, the great recession. And the other side of the sword if you will is that people are very fixated on saving money and so that's what we're about. We're about saving money, so it's been a bit of the Lord giveth, the Lord taketh away. But net-net it's been a tremendous positive and as we start to come out and get a little more confidence, just a little more is what we need, we're starting to see an explosion in sales, even above the sales we've had in the last few months, which were, by the way, the best in the company's history throughout this whole credit crunch.
Monica Trauzzi: There's a lot of talk in Congress right now about implementing a national renewable electricity standard. As someone who is on the ground working on renewable energy projects, is this an issue that you think is best addressed on a regional level or can the federal government adequately create a national standard that includes certain types of energy nationally or does it hurt certain regions of the country?
John Berger: I think that there probably is some truth to deploying something on a national basis, such as a regulatory action, such as an RPS, but I think it has been way overblown as to what certain regions would have a negative impact for instance under a national RPS. The facts are that the sun shines in the southeast much more so than other areas of the country and there's been that aspect, the utilities coming out of the southeast talking about, well, solar doesn't work here, wind doesn't work here, etc. that's obviously not the case. We do a lot of business in the southeast. We're looking to that actually to be our fastest growing market here in the next few months, as well as Texas. And I think there needs to be a distinction brought within renewable energy that not all renewable energy is created equal. The centralized power plants that people love to talk about, regardless of whether it's utilities, industry participants, or the politicians, legislators, executive branch, etc., those projects are big. They are headline grabbing. People love them. The issue though is that when you want to talk about creation of jobs, when you want to talk about actually solving the transmission and distribution problem in this country and you want to talk about actually getting people involved and getting, frankly, around the government sponsored entities, the utilities, and making individual decisions so that this process can go quicker, that all points to distributed renewable energy, not centralized renewable energy. And so there needs to be a distinction and you're seeing states start to make that. For instance, the bill that's going through the Texas House and Senate right now that was just pushed out of subcommittee I think yesterday or the day before does make a carve-out for distributed solar in particular. And so if we go and do a national RPS without a distributed carve-out, without even ... I would say you need to make it the majority of the bill, which I don't think is going to happen. I think it's going to go down to these centralized side because the utilities want that, but that's the way it should happen, but at least have a carve-out. Then you're going to have a lot more successful national RPS than you would otherwise just trying to cram a bunch of wind farms and solar farms throughout the country regardless of region.
Monica Trauzzi: You mentioned transmission as one of the major issues facing this industry. It's a big hurdle that needs to be overcome and the president has some pretty strong goals for renewable energy production. We would have certain goals to meet under an RPS. Is it responsible to have these very big goals without actually a being able to deploy the energy that we would be creating?
John Berger: Well, I think you bring up a very good point Monica. Without the transmission and distribution the centralized plants, we saw this in the 90s, at that point in time it was not really renewable energy. It was more likely combined cycle gas turbines and so forth. You would build these plants and then all of a sudden you couldn't get access into the grid, so some of the plants just literally sat there. There's a lot of political intrigue that goes along with siting transmission and distribution. It is our opinion that such political intrigue and interests in, by the way, some of those interests from the energy industry's perspective have been around for awhile. They feel like, well, if individuals in certain states don't want transmission distribution then they can freeze in the dark. And that's not what I would call an intelligent response. What a lot of the individuals out there and companies and environmental organizations, etc., are saying that in a lot of cases siting transmission and distribution is actually tremendously degrading the value of the real estate. And so what they're responding to is economic arguments and we need to pay attention to those economic arguments and make sure that we are crafting a policy such as a national RPS that takes that into regard. If we do not we will have the problem that you just described. We will be out there pushing a bunch of wind farms and solar farms and then find ourselves tied up in a tremendous amount of lawsuits that both go in the local, the state, and the federal levels. It will be what I would describe rather as a mini nightmare. And it will take us much, much longer even if we get there to solve and put an RPS in to solve the country's energy crisis than it would by going the distributed way.
Monica Trauzzi: Final question here, what's the climate like right now in your industry for green collar jobs? I mean have you seen this mad rush, people sending in resumes trying to get work at a company like yours?
John Berger: Absolutely, we take in, and the trend is accelerating, we're taking in right now about 800 resumes every two weeks and that can go from installers all the way up to managers. There is a tremendous amount of interest in getting a job in this industry. Certainly standard renewable energy, there's so many different things you get exposed to, it's not just wind and solar. We're a solutions company, so there's a lot of interest in coming here and just learning everything about energy efficiency and renewable energy, regardless of position within the company or actual functional position within the company. We take a tremendous amount of people from the home construction business oddly enough. And so we have people that were selling mortgages, we have people that were marketing for home builders, we have people that were selling homes, we have people that were constructing homes and all the individual trades, the insulation trade, the HVAC trade. We have a number of skilled trades that, frankly, used to work in the home building industry that obviously no longer have work there and have come here, gotten better training, gotten more what I would call rounded skill sets that can take them further in their careers and been very happy here. And we continue to see those people matriculate over into our company.
Monica Trauzzi: OK, we'll end it right there. Thank you for coming on the show.
John Berger: Thank you.
Monica Trauzzi: And thanks for watching. We'll see you back here tomorrow.
[End of Audio]
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