A rooftop solar company hires a utility veteran as CEO
Many energy and climate experts believe that the United States needs to urgently increase its use of solar power to address climate change. Yet, electric utilities and companies that install rooftop solar panels have long been at loggerheads about how that power is produced and who should make money from it.
Now, the country’s largest rooftop solar installer has decided to hire its CEO from the utility industry. The company, Sunrun, said Thursday that it had hired Mary Powell, who formerly ran Green Mountain Power, which is based in Vermont.
Sunrun said it had picked Powell to help the company extend even further into the kinds of businesses that until recently were the domain of regulated electric utilities such as Consolidated Edison in New York and Pacific Gas & Electric in California. Instead of just installing panels on homes, Sunrun has been trying to become a new kind of energy company that supplies solar and storage products to customers while allowing them to sell power to the electric grid.
The appointment signals that Sunrun and other rooftop solar companies intend to play a bigger role in the transition to renewable energy that President Joe Biden hopes to accelerate with tens of billions of dollars in new federal spending, including in the bipartisan infrastructure bill that the Senate is considering now. Sunrun and Powell have pushed for greater investment in rooftop solar, batteries and other local sources of power, rather than the approach favored by large utilities, which want to build thousands of miles of new power lines and large wind and solar farms in remote locations.
Powell, who led Green Mountain when it built Vermont’s largest wind farm and began installing batteries in homes, said she was joining Sunrun because rooftop solar and other small energy devices could be installed more quickly than large utility projects that can take a decade or more to build. She also said too many people in the energy business were too wedded to a system that never contemplated a two-way relationship between utilities and consumers.
“My passion around climate change is the reason I am passionate about this company,” said Powell, who ran Green Mountain for more than a decade before leaving at the end of 2019. “I’ve been working on this issue for 20 years. It’s so shocking to me that people are holding on so tightly to a system that is 100 years old.”
Powell, who has been on Sunrun’s board since 2018, will replace Sunrun’s founder, Lynn Jurich, who will become co-executive chairwoman.
“This is very much motivated by both of our intense feelings that we need to go faster on climate,” Jurich said. “Climate change is not waiting around for us to build large-scale transmission lines.”
Some energy executives and climate activists have argued that the country needs an “all of the above” approach to reducing emissions of carbon dioxide and other gases responsible for climate change. The country needs large and small energy projects, transmission lines, and home and business batteries, which can be as small as large televisions and as big as shipping containers. These investments, activists say, need to happen quickly because wildfires, heat waves, hurricanes, winter storms and other extreme weather linked to climate change have crippled electricity grids.
“This is bigger than utilities,” Pedro Pizarro, CEO of Edison International, parent company of Southern California Edison, said recently. “This is bigger than one industry.”
Yet, utilities and rooftop solar companies are engaged in fierce political battles in state capitals. Many utilities and their allies are asking regulators and lawmakers in places such as California and Florida to reduce the rates they pay for the electricity produced by rooftop solar panels. Or they are seeking to impose new fees on rooftop panels.
Utilities argue that these changes are needed because as more homeowners buy solar panels, fewer people are left to share the cost of maintaining the grid. But homeowner groups and solar installers such as Sunrun counter that the utility-led efforts will reduce the number of people who can afford rooftop panels, which they argue lower emissions and help bring down the cost of electricity for everybody by reducing the need for new transmission lines and power plants.
“To achieve the necessary emissions reductions, solar will have to grow four times faster than we are growing today,” Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association, said in a statement last week.
In addition to utility opposition, the rooftop solar business faces other obstacles. The cost of installing solar panels is much higher in the United States than in countries such as Australia, in part because obtaining permits from local governments is more onerous here. Many rooftop solar companies, which spend substantially on sales and marketing, are not consistently profitable.
Sunrun said Thursday that it had lost $41 million in the second quarter, up from $14 million a year earlier. The company last year acquired Vivint, one of its biggest competitors, extending its lead as the largest rooftop solar installer in the country. But its stock price has tumbled in recent months, falling from about $80 in February to about $50 now.
Powell will have to convince investors that Sunrun’s plans to expand beyond installing panels will be profitable. (Her brother Michael is a reporter at The New York Times.)
Vikram Aggarwal, founder and CEO of EnergySage, a rooftop solar comparison shopping service, said Powell’s experience at Green Mountain could be useful to Sunrun.
“I think Mary Powell is a very highly regarded utility executive,” he said. “She’s very consumer focused. She knows the climate crisis and all.”