SYRACUSE — BlueRock Energy is preparing to introduce a new subsidiary called BlueRock Energy Solar, which will organize the design, sale, financing, and installation of solar-energy systems for residential homes and small- to medium-sized businesses.
The parent company is BlueRock Energy Holdings Inc., headquartered at 432 North Franklin St. in Syracuse. It currently consists of two subsidiary companies: BlueRock Energy, an electricity and natural gas provider and the core business, and BlueRock Energy Services, launched in December 2014, which provides LED lighting retrofits and other energy-efficiency measures and monitoring services.
BlueRock Energy Solar is expected to be up and running by the end of October, according to BlueRock Energy chairman and CEO, Philip Van Horne, who founded the company in 2003.
“The economics for solar work right now,” he says, citing the declining cost of solar panels, and the availability of state subsidies and federal tax credits. “Solar makes sense for both homeowners and businesses.”
The expansion, which Van Horne says has been in development for about six months, and is being funded through a combination of “internal organic growth” and “outside equity from private-equity investors.” He declined to specify the startup costs or disclose company financial information.
A verbal agreement has been reached with the person who will head BlueRock Energy Solar, says Van Horne, but he declined to give his name as the hiring had not been finalized, as of Sept. 22. Once that is complete, the new employee — whose title has not been determined — will put together his team.
The addition of BlueRock Energy Solar is expected to generate about 30 new full-time positions over the next 12 to 18 months, according to Van Horne. BlueRock Energy and BlueRock Energy Services have a combined 54 employees currently, all but three of whom work full time, he adds.
The new positions will be sales, project management, and administrative in nature, according to Van Horne. He says he is a proponent of internal promotions, so applicants from within BlueRock for new positions will likely be given preference during the hiring process.
The company will be searching for additional office space in Franklin Square in Syracuse (where the firm is headquartered) to accommodate new employees, says Van Horne. About 40 staff members work from the 8,500 square feet it currently leases in the city, which has room for between six and eight more staff, according to Van Horne. The rest of the company employees are salespeople who work from home, he adds.
Overall revenue growth is forecast at about 30 percent, according to Van Horne. “We’ve been about that number for the last eight years,” he says.
BlueRock Energy Solar may not contribute much to that growth initially, due to startup costs, he adds, but once it is fully operational, the subsidiary is expected to contribute around 20 percent of the company’s total revenue.
BlueRock Energy’s current service area consists of New York, Pennsylvania, and Connecticut, due to the restrictions put on commodity sales, such as electricity and natural gas (the company’s core business) says Van Horne. However, the solar subsidiary will be able to operate throughout the Northeast, thanks to the more lax regulation of solar.
Going solar
BlueRock is working on establishing a partnership with another company, says Van Horne, to handle portions of the solar projects. He declined to name the company, as the negotiations were still ongoing, as of Sept. 22.
BlueRock Energy Solar will be responsible for sales and project management — including the paperwork for state rebates and the federal tax credit — and the partner company will handle the engineering and design of each project, as well as the procurement of solar panels.
There is a plethora of solar-panel providers, says Van Horne, which allows the company to pick the best type for each project.
“Who has the best panels and the best price seems to change monthly,” he says.
The target market will be rooftop projects, but the company will also accommodate clients interested in a ground-mounted system.
The installation of the panels for each project will be put out for contractors to bid on, says Van Horne. After the bids come in, BlueRock will then relay that cost to the client.
“They’ll know what the installation cost is, they’ll know what their rebate is, and they’ll know what their tax credit is going to be,” says Van Horne, “so they’ll have all the numbers before they agree to install all the panels.”
A normal timeframe for a residential project is around eight to 10 weeks, according to Van Horne. The installation itself typically takes between one and three days, depending on the electrical wiring of the house.
Commercial installation can take as long as six months because of the more lengthy design and engineering phases, he says.
“What we will do is integrate the solar panel design with the design of the building so it fits the architecture of the building,” Van Horne says.
BlueRock Energy Solar began to take shape after Van Horne met with the CEO of the partner company and formulated a business plan. A couple other pieces also had to fall in place, including the company’s financial situation, and the current market for solar systems, he says.
The 30 percent investment tax credit offered by the federal government for commercial and residential properties with solar systems is set to drop to 10 percent at the end of 2016, “so there is a rush to put the panels in place,” says Van Horne.
Current New York law doesn’t require additional licensing or permissions to install solar systems, as opposed to other forms of energy, according to Van Horne. However, the New York State Public Service Commission is exploring a proposal that would change that, he adds.
The proposed legislation would require companies to get additional approval from the Public Service Commission to install solar systems. Van Horne says he won’t be concerned if the legislation passes because BlueRock Energy already abides by those rules, which are already in place for energy supply companies.
The same can’t be said for some of BlueRock’s competitors, many of which are not energy suppliers, says Van Horne. Those companies would have to adapt to the new rules.
Looking ahead, and looking back
BlueRock Energy is waiting for the state of New Jersey to approve the company’s application to sell electricity and natural gas in the state, says Van Horne. The company only recently expanded beyond New York in June, when both Pennsylvania and Connecticut accepted the company’s application to sell energy.
In addition to growing its service area, and the services provided, BlueRock is “looking actively at some acquisitions that would help us expand,” Van Horne says. He declined to provide further details.
An important component of the company that Van Horne says he will continue to stress is employee participation in community service activities. He lists the Syracuse Rescue Mission, the Food Bank of Central New York, the American Diabetes Association, and the American Red Cross as organizations and programs that
the company to which its employees have contributed time and money.
Van Horne recently founded a nonprofit called Save the Skin, which seeks to raise money for melanoma awareness. Save the Skin recently held its annual golf tournament. Van Horne says it raised $45,000, “which for a golf tournament in Syracuse is a number I’m extremely proud of.”
Van Horne founded BlueRock Energy in 2003 after ending a 19-year stint with the Niagara Mohawk (now National Grid) utility company. BlueRock is currently owned by 14 investors. Van Horne is the majority owner.