Do alternative energy sources — solar panels, geothermal heating systems and the like — really save you money on energy costs? Well, Hudson Valley Clean Energy, a Rhinebeck-based installer of such systems, certainly thinks so. To prove it, they put their money where their reputation is. And their reputation clearly won.
HVCE executives designed and built their new headquarters entirely with their own line of alternative, carbon-neutral energy products. And after a year of watching the electric bills, they proved that it is possible to harness the sun and the earth to generate all the energy you need — and more — to power a 4,100-square-foot office building and warehouse.
It’s called “zero net energy,” and this fall HVCE became the first commercial structure in New York State to achieve it. The company’s only outside energy cost was the $22-a-month bill from Central Hudson just to be connected to the grid (which they maintain as a backup measure).
The all-electric structure generates its own juice using a photovoltaic (PV) system to turn the sun’s rays into electricity and solar thermal collectors to heat its hot water. Two geothermal units circulate air 300 feet below ground, which provides winter heating and summer air conditioning.
In the first year of operation, HVCE generated 16,614 kilowatt-hours of its own electricity, using no fossil fuels and generating no carbon whatsoever. It consumed 15,636 kilowatt-hours. “So we generated more energy than we used,” says co-owner and vice president John Wright. “Our utility meter actually spins backward.” The company sells the extra power back to the electric company, making the system profitable as well as earth-friendly. And that’s exactly what HVCE wanted to prove. “When we decided to build our new headquarters a year ago, it made sense that we use it to demonstrate what is possible,” said Wright, 37.
Wright already knew what was possible, of course. He cofounded the company in 2003 with his brother-in-law, Jeff Irish, who serves as president. Both were working corporate jobs at the time; Wright as a director in marketing with AOL Time Warner, Irish as an executive with GE. They dreamed of starting their own business, and tossed around several possibilities over the years. Irish, an electrical engineer, was installing PV panels in his home in late 2002. He was barely off the ladder when he called Wright and said, “I think I have an idea.”
“He told me he had put these panels on his house and a few people said they would be interested in them,” Wright said. So they wrote up a business plan, got certified as PV installers by the New York State Energy Research and Development Authority (NYSERDA), and hung their shingle. “The timing was absolutely perfect,” Wright says. “With energy prices rising and everyone suddenly interested in global climate change, we were in the right place at the right time.”
That’s not to say they got rich. “We definitely struggled the first five years,” he says. The first year they had all of 10 customers. But they knew that, globally, the renewable energy industry was growing at more than 25 percent a year. “We were determined to stick it out,” he says.
About two years ago, the company added geothermal and solar thermal systems to their portfolio. That’s when zero net energy design really became possible. Wright put it to the test himself when he built a new home for his family in Rhinebeck. “I did all the research on it and was my own general contractor,” he says. It worked, and his house became one of the first documented zero net residential structures in the state.
Thanks to several factors — including ever-increasing awareness of the global climate crisis, more favorable federal and state tax credits for alternative energy, and skyrocketing fuel costs — business is now booming. HVCE is the largest local alternative energy supplier, Wright says. The company has about 25 employees and served more than 50 commercial and residential customers last year. “People think of us when they are renovating or building a home,” he says.
Photograph courtesy of Hudson Valley Clean Energy
The new headquarters is more than just an energy-efficient office; it also serves as the company’s showroom. “One of the biggest misconceptions about alternative energy is that the technology doesn’t work,” Wright says. “Potential customers can come here to touch and feel and see it in operation. It really puts that idea to rest.”
Wright has sound arguments for several other misconceptions as well, starting with the financial one. “People think it takes 25 years to make back your money, but with new construction, the break-even point is immediate,” he says. “Once you finance the extra upfront costs of this technology into the mortgage, your lower utility costs far outweigh the higher mortgage payment.”
There are also a variety of tax credits, rebates, and low-interest financing options to help defray costs. NYSERDA, for example, paid for about 40 percent of the PV installation, says NYSERDA spokesman Tom Lynch.
Retrofitting an existing home or commercial property is more costly, Wright admits, but far from a financial drain. “We use various models, and all of them are cash-flow positive after four to 10 years,” he says. Plus, there is dollar-for-dollar residual value. “If you spend $30,000 on one of our systems, your property is immediately worth $30,000 more,” he claims.
He’s even ready to debunk the belief that there isn’t enough sunshine in the northeastern United States to generate all those precious kilowatts. “Here in the Hudson Valley, we get 4.5 sun-hours a day over a year. Germany, the biggest PV market in the world, gets 3.5 sun-hours,” he says. “We get more than enough sunshine to generate heat and hot water.”
Though HVCE is the first zero net commercial building in the state (and it may be the first in all of New England, says Lynch; “It’s hard to know because no one really keeps track of that information”), it certainly won’t be the last. HVCE has begun working mainly with residential builders to create zero net homes, several of which are in Ulster County. But they are also in negotiations with commercial clients who are looking into following their lead. “We expect to see more and more of these buildings each year,” says Lynch.
Twenty to 30 years ago, when PV power first became viable, it was — like many new technologies — fraught with problems. “Many systems were installed poorly, and that gave the industry a black eye,” says NYSERDA spokesman Tom Lynch.
Today, NYSERDA certifies all reputable PV and other alternative-energy installers to ensure they have the necessary skills and that their systems produce the maximum number of kilowatts. “These are significant capital investments, and we want to make sure they work well,” Lynch says.
To find a NYSERDA-certified installer, visit their Web site, www.nyserda.org.