San Antonio Express-News (Sunday)
POWER OF AIR
Flux: “The Wright brothers of our age”: Rangel Renewables founders talk about wind business.
Wind energy is increasingly powering the state of Texas, and Josh and Moses Rangel want to be part of the change.
Wind turbines are the dinosaurs of renewable energy. They’re not as new as solar power, and not as flashy an energy technology as batteries or hydrogen. But there’s a lot of land across Texas on which to build wind turbines, and in 2020 they contributed 25 percent of the electricity in Texas.
Wind surpassed coal as an energy source in Texas last year, and is now second only to natural gas.
Josh Rangel, 34, is president and CEO of Rangel Renewables. He started the company in 2016 and brought in his older brother, Moses, 39, soon after. The company constructs and maintains wind turbines for land developers who sell the electricity to utility companies.
Last year, Rangel Renewables erected enough wind turbines around the country to generate 1 gigawatt of power. For reference, all the wind farms in Texas produced 8 gigawatts of electricity combined in November.
The young company is growing rapidly, and the brothers have eyes on the next leap for wind power — offshore turbines.
Despite the deep freeze that iced over wind turbines and rocked Texas earlier this month, energy experts say wind technology will continue growing as an energy source for the foreseeable future.
The following interview took place prior to the winter storm event in February. It has been edited for clarity and length.
Q: So how did you come to start the only major wind energy company in San Antonio?
J.R.: I had gone off to play golf at University of the Incarnate Word. I always knew I either wanted to pursue (golf ) professionally or start my own business.
My degree was in marketing, and I had done an internship in Michigan. When I came back to San Antonio, there was a job in Houston that was tailored to what I had been doing in Michigan. Two weeks into that job, they sold the company. As I was going to networking events, I started meeting people in the energy industry. That was in 2014. So at that point, I took a pay cut to go over to this energy company, and I got selected to be on the power and nuclear team. So that’s how I got into that market.
I was in a transition from being a consultant to business development, and I told them, “Hey, from everything I’m reading, renewables is a new push. That’s where the money is going to go.” So I said, “Let me go after that.” They said no, just focus on oil and gas. But I presented a business plan and in a few days I landed two projects in Minnesota and North Dakota. I was with them maybe six months, and then I called up my brother and I said, “Hey, man, I need to prove it to myself that I can do this on my own.” I had the recipe, and I just needed to figure out a few things.
Q: How did you land projects off the bat in Minnesota and North Dakota?
M.R.: Networking.
J.R.: That’s really where you get all your leads. At that point, I just made a few phone calls to individuals I had already been speaking with. So they called me and said, “Hey, you’re saying you can do this — how soon can you get out here?”
Q: How does a typical project come together for Rangel Renewables?
J.R.:
We’ve built out team for individual sections of what needs to get accomplished. Moses, our CFO (chief financial officer), he’s going to be over the contracts, everything that’s going to be on the financial side — what’s going to pay for the project, upfront costs. Our operations manager is making sure all the manpower, trucks, rentals, cranes, everything is scheduled to go to where it needs to be.
At that point, we have a director of wind construction. He’ll keep a tally of what needs to be done in the field. Then all the major components will get scheduled to be delivered — so logistics. At that point, we’ll get in touch with our crane vendors, and say this is the number of cranes we need, this is when we need to start moving it. Q: So building a single wind turbine is something of a logistical feat.
M.R.: It’s large-scale industrial construction.
Q: How many employees do
you all have?
M.R.: At our peak last year, we got up to 103 employees.
Q: Without the backing of a wealthy financier or global corporation, how do you start a company from the ground up in such a capital-intensive business?
M.R.: When ( Josh) made the phone call to me, I had had some cash reserves. So we started off slow. What you see is years in the making. The industry we’re in is also ripe right now, especially the move from fossil fuels to renewables. We’ve been privileged to be a part of the market four years ahead of time of other companies. It started out like any other small business — you grow gradually. Some of our projects were only a few hands at a time. We’ve gotten into bigger projects, and those developers that we were working with, there’s contract revenue tied to that. You’ve just got to manage the funds in order to be able to grow and reinvest into the organization to then take
on bigger projects.
Q: How does each party make money in a project between the landowner, the land developer and Rangel Renewables?
J.R.: Say you own the land. A developer will say, “We’d like to build 20 turbines on your farm.” You’d say, “Give me a price. OK, let’s agree upon $12,500 a month per turbine.” So that developer is going to pay you to keep you on a power purchase agreement for the next 20 years. That’s just incremental revenue that you’ll always have. But we don’t get paid by the landowner. We’re getting paid by the developer to say, “OK, this is what you guys are going to build.”
M.R.: We’re part of the construction that is building it from the concrete pad up. The landowner has to broker a deal with the developer; then the developer, they put that (electricity) in the grid and sell that power to the electric company, like CPS. Q: So how was your business doing about a year ago, and then how was it affected when the pandemic began?
J.R.:
Everything that the pandemic unfortunately presented for everyone else, it was the opposite for us. At this time last year, we probably had about 40 people. The pandemic shut everything down, and we grew to 80 people. By the end of March is when we were running employee numbers between 95 and 103.
When everything shut down, we turned it on and went from just working straight days to days and nights. It was just the cycle of the construction. What happens is you have all your cranes set up. You have your equipment at each pad. Now you’re ready to bring in all these people and run and gun. So how the pandemic affected us — it just happened that we were already getting set to turn things on. We were like in a bubble. We weren’t in a major town. We were in a rural area, so we were able to be the beneficiary of having to stay there so all we had to do was just work. Last year alone, we built over a gigawatt of power.
Q: How will the Biden administration impact your business?
J.R.: We’re going to be the beneficiaries of the election. The vision is we had wanted to, in the next three years, go offshore. But now we’ve seen the rapid pace Biden wants to go. Now we want to have a satellite office in Boston or Atlantic City by the end of the first quarter.
Q: What opportunities would an office in the Northeast open for you?
M.R.: Offshore. We’d be able to do a lot more networking. We can present ourselves to developers in that area, and say, “Hey, we’re here to help.”
Q: How do you feel about the business of offshore wind?
J.R.: It’s going to be more expensive. But we’re behind the times. You look across the pond, they’ve got floating, permanent platforms. You’re talking about three to four wind farms in the ocean that have been built (in the U.S.), compared to thousands over in Europe. So we’re creating that market here in the U.S., but we work now with a lot of individuals who are from the European market, a lot of people from Denmark. They’re taking what they know and they’re bringing it to the U.S. Because how do you do something that’s never been done before? Well, you’re going to go get the expertise.
Q: Wind has become the secondlargest power source for electricity in Texas. What’s helped wind grow as a power source?
J.R.: Technology has improved, but it’s gotten cheaper over time compared to what it was.
M.R.: They’re not making more dirt, so if you put a lot of solar panels on land, then that’s it. With a wind turbine, you’re harnessing the wind, and they’re making the turbines taller and bigger. They produce more power and they’re less expensive, and it’s all starting to level out.
Q: How does it feel when you look back over the last few years and see how quickly Rangel Renewables has become a player in wind energy?
M.R.: I feel like the Wright brothers. It was over 100 years ago that Orville and Wilbur tried to take flight. They didn’t have the money, they didn’t have the press, and they were able to do that. If you go 100 years into our day and age, we have jets, drones, and now we have these two Hispanic boys from San Antonio who are doing onshore with the vision to do offshore. To me, I feel like the Wright brothers of our age.