Success soars with the wind-2-year-old Boulder Colorado company gives consumers a Renewable Choice

It’s not surprising that Quayle Hodek has lofty ambitions for his company, Renewable Choice Energy. After all, he’s selling wind.

By Vicky Uhland, Special To The Rocky Mountain News

Boulder-based Renewable Choice Energy is the only private business in the state that sells wind energy, and one of only a few such companies nationwide.

"They’re one of a small handful that go up against the utilities," said Mark Kapner, manager of conservation and renewable energy at Austin Energy. The Texas-based utility, along with Colorado’s Xcel Energy, is one of the largest wind-energy vendors in the country.

When 24-year-old Hodek moved to Boulder two years ago, his goal was not to play David to Xcel’s Goliath. He and two friends from Chapel Hill, N.C., already had founded one company: Zoom Culture, a media company for young people. They moved to Boulder with the idea of starting another business. The only problem, Hodek said, was "we didn’t know exactly what kind of company we wanted to start."

But then Hodek heard about Xcel’s Windsource energy plan, where customers buy kilowatt hours of wind-generated energy to replace electricity that comes from coal or natural gas. Not only did Hodek like the idea of a renewable, clean energy source, he also liked its business potential.

He did some research and found that 98 percent to 99 percent of Coloradans don’t use wind power, but that about 30 percent would be willing to try it. According to Xcel Energy spokesman Steve Roalstad, Xcel’s Windsource program, which began in April 1998, has grown 50 percent a year. Still, less than 2 percent of Xcel’s 1.3 million customers have signed up for Windsource.

"There’s a huge, unfilled demand," Hodek said.

Hodek also liked the idea of a private enterprise selling renewable energy.

"I realized that someone else rather than the utility company, which is a gas and oil company, should be selling wind energy," he said.

Certainly, there wouldn’t be much competition. "Energy is a $228 billion industry. There aren’t that many opportunities for newer, smaller companies to come into it," Hodek said.

Backed by $350,000 from private investors, Hodek and his friends from Chapel Hill – Kris Lotlikar and Shea Gunther – started Renewable Choice Energy in September 2001. Hodek is president and CEO, Lotlikar is vice president of marketing and Gunther is vice president of design and media. The company has three other employees.

Hodek expects Renewable Choice to generate $1 million to $2 million in revenues this year and to turn a profit.

Under the American Wind brand name, Renewable Choice began selling wind energy to consumers and businesses in January. As of September, it had 1,200 residential customers and 60 business customers.

Roalstad said Xcel’s Windsource program expects to have about 24,600 residential customers and 400 businesses by the end of the year.

Renewable energy is sold in the form of credits, also known as green tags or green certificates. When the owner of a wind farm sells the energy generated from windmills to a utility or a company such as Renewable Choice, a certificate is issued. One certificate equals 1,000 kilowatts of wind energy, and the certificates can be sold and traded as commodities among utility companies, governments and private companies.

Customers can buy as many kilowatts of wind energy as they want, replacing all or part of their electricity usage with wind energy. The idea is that as more customers buy more wind energy, more wind farms are built to keep up with the demand, and more renewable energy is delivered to the national power grid, which provides all electricity across the United States.

"What you’re doing is changing the whole mix of the power pool across the U.S.," Hodek said. "Consumer demand is what’s driving the growth in this industry. We’re not waiting around for government. It’s a pure market-based approach."

Austin Energy’s Kapner admits that wind energy is "such an intangible industry that there’s a lot of potential for abuse." Renewable energy claims aren’t regulated by the Public Utilities Commission, meaning any company can say it’s selling wind-generated electricity. In an effort to impose standards, San Francisco-based Green-e, a voluntary certification program, was founded in 1997. Renewable Choice is Green-e certified, meaning that the energy it sells is at least 50 percent renewable and comes from wind farms that were built in the past six years.

Wind energy costs about 2.5 cents more per kilowatt hour than electricity generated by coal or natural gas. Renewable Choice customers are charged for their wind-generated electricity as part of their monthly Xcel utility bill.

Renewable Choice, which has customers in 12 states, has exclusive agreements with wind farms around the country to supply the company’s wind energy. It’s in negotiations with the Foot Creek Wind Project near Arlington, Wyo., as part of a long-term deal that would double Renewable Choice’s wind energy supply.

Renewable Choice sells the wind energy in a surprisingly low-tech way, via seven door-to-door, commission-only salespeople in metro Denver and Boulder.

"Our biggest challenge is customer education, so we went for a one-on-one approach," Hodek said. "We look at ourselves as almost the ground troops getting out the word about wind power."

Xcel’s Windsource at a glance

• Xcel Energy generates the wind power it sells as Windsource? in Colorado from the Ponnequin Wind Facility, just south of the Wyoming state line.

• Ponnequin is the first and only commercial wind farm in Colorado. The wind farm has 44 turbines that can generate up to 30 megawatts of electricity.

• Xcel also buys power for Windsource from a 33-turbine wind farm near Peetz, just south of the Nebraska border.

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