Here’s a tale of two savvy young men from Vermont who hit the jackpot by selling their startup company to a larger one for $40 million.
Let’s turn the clock back to 2009. The two now rich men were Board President and Clean Energy Program Director at the Vermont Public Interest Research Group. VPIRG was then, and is still, a nonprofit action organization, promoting a wide range of liberal causes and coalitions. Its budget in 2020 was $1.954 million.
A major part of VPIRG’s program (51% in 2019) was its advocacy for “incentives for clean energy developers”. It was out front in the campaign to rid Vermont of the 600 MW Vermont Yankee Nuclear Plant, which after years of state extortion and legal battles (which it largely won) closed down in 2014. Yankee nuclear was “clean energy”, just not generated by VPIRG contributors.
Among the long list of energy policies urged by VPIRG was putting $30 million into the Clean Energy Development Fund, to finance homestead solar power systems marketed by, among others, VPIRG board member David Blittersdorf, whose personal foundation has long been a major contributor to VPIRG.
VPIRG also pushed for tax benefits for “community development of solar power generation”, the “feed in tariff” law that required utilities to purchase renewable power at up to four times the market price, the Renewable Portfolio Standard that requires utilities to buy state-mandated quotas of wind and solar electricity, and the 2011 net metering law, which allowed Blittersdorf’s solar panel customers to sell their power to utilities at a retail rate, leaving other customers to absorb the poles and wires cost of maintaining the power grid.
Beginning in 2015, VPIRG was also in the forefront of a campaign to impose annually increasing carbon taxes on gasoline, diesel, heating fuel, natural gas, and propane, which happily failed despite the efforts of as many as 23 VPIRG lobbyists working the legislature on its behalf.
In 2020 VPIRG went all out to pass the Global Warming Solutions Act, setting tough mandatory requirements for reducing carbon dioxide emissions. The act also created a pseudo- government Climate Council to instruct the executive branch to issue far-reaching new regulations to bar fossil fuels for transportation, electricity, and business, school, church, hospital and home heating.
Gov. Scott vetoed the bill, but the legislature overrode his veto. The Council is hard at work organizing all of VPIRG’s climate and energy mandates into a breathtakingly extensive and costly action plan to be announced on December 1.
The 2010 election brought into office Gov. Peter Shumlin, previously known as “the Senator from VPIRG”. He was an enthusiastic anti-nuclear crusader and climate alarmist who warned of “an unspeakably horrid future” for our grandchildren if Vermonters failed to wage all-out war against the menace of climate change.
With Gov. Shumlin leading a large Democratic-majority legislature for what proved to be six years, it was clear that much if not all of VPIRG’s ambitious climate program would become law.
So in 2012 VPIRG Board President Duane Peterson and its Clean Energy Program director James Moore departed those positions and launched a for-profit startup called SunCommon. Its business plan was to market and install the increasingly state-incentivized solar energy collectors to commercial, industrial, and residential customers. Their labors and foresight were rewarded. The young company’s revenues grew to $33.1 million (2020). Its acquisition by Williston-based iSun promises significant synergies in marketing and installing solar power systems throughout northeastern US.
This is the way capitalism is supposed to work. Two capable and energetic entrepreneurs envision a company that, given prevailing public policies, should meet consumer needs and earn a good profit for their investors.
But there’s this troubling reservation. Could SunCommon have so dramatically succeeded if Vermont’s energy and climate policies were what they were before Gov. Shumlin pushed through most of the VPIRG energy agenda? Clearly not.
Peterson’s and Moore’s VPIRG raised $20 million (2009-2020) and devoted maybe half of that to persuading politicians and legislators to rig a bunch of special deals to create a lucrative market for a company like SunCommon to make money. As soon as they saw that coming, Peterson and Moore created SunCommon to cash in. (Peterson remained on the VPIRG Board until 2018.)
There’s nothing wrong with a company created to take advantage of business opportunities made possible by political decisions. It’s somewhat less creditable when the owners of the company cash in on what they and their coworkers spent millions of dollars to get politicians to put in place for a decade to enable their big payday.
Seventy five years ago some people criticized Henry Kaiser and Henry Ford for being “war profiteers”. Yes, they made profits by selling ships and tanks to the government to win a world war. But neither of them conducted a campaign to persuade Japan to bomb Pearl Harbor.
John McClaughry is vice president of the Ethan Allen Institute (www.ethanallen.org).
Crony capitalism Vermont style. The non-solar electric rate payers subsidize this boondoggle big-time.
At the bottom of the street where I live in South Burlington is a solar farm that I believe was installed by Sun Common a few years back. At the dedication ceremonies newly elected Gov. Shumlin spoke and I attended his opening remarks.
I paraphrase his comments: “I told you if you elected me I would get things done”.
He sure did!
Along with that august body known as the Vermont Legislature the Governor guaranteed the owners of the solar farm a rate of 25 cents per kwh (or was it 20 cents per kwh?) for… wait for it…. 20 years!
That was at a time when Hydro Quebec was charging 5 cents per kwh!
Ah yes, Peter Shumlin (and those titans of compassion… the Vermont legislators), the gift that keeps on taking from hapless customers known as Vermont citizens so that solar farm developers can enjoy the fruits of capitalism. Ain’t that just grand.
I should add that the title on this commentary was supplied by the editor. My title was “A Capitalist Success Story”, to lure anti-capitalist readers eager to object to whatever I had to say. Also, David Blittersdorf says he was a VPIRG board member “for a while” but not necessarily during the 2009-2016 period when VPIRG and Shumlin pushed through the various benefits now providing the SunCommon founders with a secure retirement. Blittersdorf readily admits that he and his Foundation have given a lot of money to VPIRG over the years.. No complaint from me about that – it was his money to give.