suncommon's 2012 annual benefit report

7/28/2019 SunCommon's 2012 Annual Benefit Report

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2012 Annual Benefit Report


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Timeline

Early March, 2012

First SunCommoncustomer goes solar

June 20, 2012

First annualSunCommon

Summer SolsticeCelebration

June 26, 2012

Customer signs up forSunCommons 100thsolar system

October 1, 2012

Expand intoAddison County

November, 2012

Our first profitable

month

December 31, 2012

First year ends with 50%residential market sharestatewide

March 8, 2012Vermonts governorparticipates in medialaunch to openSunCommons doors forbusiness in ChittendenCounty, WashingtonCounty, and Stowe

February 1, 2012

Hired up, the inaugural 16employees move into TheEnergy Mills net-zero of ficespace and begin to buildour company

December 19, 2011

SolarCommunities, Inc(DBA SunCommon)incorporates, as Vermonts

ninth Benefit Corporation a full-service solar solutionwith marketing, sales, design,

financing, procurement,permitting and installation

2010

VPIRG Energy pilotscommunity organizingapproach to marketingsolar

2012

2013

2011

2010


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SolarCommunities, Inc. (D.B.A. SunCommon)

2012 Annual Beneft Report

Introduction

SunCommon believes that everyone has the right to a healthy environment and saerworld. Our mission is to tear down the barriers that have made renewable energyinaccessible. We intend to repower our communities one home, one school, and onebusiness at a time. We make going solar easy and aordable so that all Vermonters cantogether create a healthy environment and saer world.

Chartered as Vermonts ninth Beneft Corporation, SunCommon attends to the triplebottom line o people, planet, and proft. Driven by our mission to dramatically increasesolar in the state, we gauge our success not only by the proft we make, but also by ourability to do right by our workers, the communities in which we operate, and the habitatsthat sustains us.

In accordance with Vermont law, this report provides details regarding SunCommons

standing as a Beneft Corporation and the progress that weve made to positively impactsociety and the environment. Specifcally, this report discloses:

Overview o the company including required inormationregarding our directors and ofcers;

SunCommonsgoals or creating a public beneft and the obstaclesand outcomes associated with those goals;

Specifcactionswe will take to improve our social and environmental impact; and

Shareholder-approvedgoalsor achieving public benefts in the next year.


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About the Company

HISTORY

SolarCommunities, Inc. (D.B.A. SunCommon) is the outgrowth o a successul pilotprogram that operated within the Vermont Public Interest Research Group (VPIRG), thestates largest consumer and environmental advocacy organization. Recognizing that itsmembers yearned or their own sources o sustainable energy, the non-proft piloted theVPIRG Energy program as a community organizing approach to marketing solar. VPIRGEnergy was created to make it easy and aordable or Vermonters to go solar. The projectcreated a volume o consumers interested in solar in specifc communities to createefciencies that dramatically reduced the cost. In just one year, that eort helped morethan 300 Vermont amilies get on the road to solar.

VPIRGs Board o Trustees believed rom the beginning that the scale required to meetthe demand or solar would require a scale inappropriate or the non-proft and that a

separate entity would be needed. To avoid conicts o interest with the new entityspartners, including utilities whose policies VPIRG needs to be ree to conront, VPIRGchose to entirely separate rom the new entity that would become SunCommon. Hence,SunCommon was born at the end o 2011 as an independent Beneft Corporation.

PHILOSOPHY OF BUSINESS

SunCommon is Vermonts ninth Beneft Corporation with a legal charter that directs usto attend to the triple bottom line o people, planet and proft. Typically, businesses inAmerica are actually required by law to maximize shareholder proft. Beneft Corporationsput their investors, employees, neighbors and all stakeholders on notice that while weintend to make a proft so that we can invest in the business and grow, we also will do

right by our workers, the communities in which we operate, and the habitats thatsustain us.

We compensate our workers well and oer generous employee benefts. Our ofcesare in an intentionally designed space that burns no ossil uel but generates all thesustainable energy we need on site, in a building constructed largely rom local andreused materials. And weve secured a eet o high-mileage hybrid and electric vehiclesto minimize our transportation-related ootprint.

Among the joys o running a company is the ability to apply our personal values toevery business decision we make. We wont always get it right the frst time, but we arecommitted to operating this business to beneft our people and our planet.


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Overview o Company Structure

DIRECTORS AND OFFICERS

SunCommon is governed by a three-member Board o Directors comprised o DuanePeterson (co-president), James Moore (co-president), and the yet-to-be-elected BeneftDirector. The role o the Board o Directors is to approve SunCommons business planand budget, and to set the compensation o the companys Co-Presidents. At the end o2012, SunCommon was still in the process o recruiting a Beneft Director. Once recruited,the candidate or Beneft Director stands or election by the companys preerred stockshareholders.

SunCommons three-member Board o Directors is currently comprised o:

DuanePeterson,Co-President Duane is a social entrepreneur with an eclectic35-year career in socially responsible business, campaign management, government

service and community involvement. He most recently co-directed the successul VPIRGEnergy project, SunCommons predecessor ater serving as Chie o Stu at Ben &Jerrys or 12 years tasked with executing Ben Cohens creative vision. Committed toadvancing values-led business models, hes a member o the national Social VentureNetwork and the Vermont Venture Network.

JamesMoore,Co-President James has dedicated his proessional career to helpingcreate a clean energy uture. With deep experience in energy policy, clean energytechnology and government relations, James is in charge o solar design, sales, andgovernment relations at SunCommon. He worked in Washington State, Connecticut,Florida, New Jersey, Washington D.C., New Hampshire and New Mexico beore movingto Vermont in 2004. James directed VPIRGs Clean Energy Program and co-directed, with

Duane, the successul VPIRG Energy project.As Co-Presidents o the company, Mr. Peterson and Mr. Moore each own 40% o theshares o SunCommon in common stock. Twenty investors hold preerred shares totaling20% o the companys equity.

BeneftDirector As mentioned above, the company is still in the process o recruitinga Beneft Director to round out the Board o Directors. SunCommons goal is to completethe recruitment and elections process by mid 2013.


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BOARD OF ADVISORS

In addition to the Board o Directors, SunCommon benefts rom a dynamic Board oAdvisors who provide advice and guidance on the companys strategic vision. This Boardo Advisors includes:

BenCohen Ben co-ounded Ben & Jerrys and pioneered its values-led businesspractices. His innovative marketing engaged that company on progressive issues and

campaigns that produced meaningul change while building the iconic brand based onmeaning. Ben was central to the creation o the national networks Businesses or SocialResponsibility and Social Venture Network.

CairnCross Cairn is a co-ounder o Fresh Tracks Capital and serves as a ManagingDirector o the Fund. Cross serves on the boards o FreshTracks portolio companiesVermont Teddy Bear, NEHP, and NativeEnergy. Cairn was ormerly the Chair o the Boardor the EatingWell Media Group which was sold to Meredith Corporation in 2011. He isa member manager o Snow Farm Vineyard, LLC, Vermonts frst grape wine producerlocated on Grand Isle. Cairn spent the 1990s in strategic and fnancial consultancy toVermont banks and growth businesses such as Collector Online, Otter Creek Industries,Green Mountain Coee Roasters, and the Merchants Bank and various senior positions

at the Howard Bank and Vermont National Bank. He has served as Co-Chair o theVermont Investors Forum, an annual venture air or Vermont companies, and on theBoards o Opportunities Credit Union and Vermont Community Loan Fund.

MattEwing Matt has worked at the intersection o technology and social changeor the last decade. He recently co-ounded Rewire, a cleantech sotware frm thatspecializes in helping companies turn their customers into evangelists or clean energy.Rewire also managed the Sierra Clubs successul Solar Homes Campaign in Caliornia, apartnership between the Sierra Club and leading solar home companies. Prior to Rewire,he was the ounding director o New Media Ventures (NMV), a network o progressiveangel investors that closed $1m in startup deals. Previously, Matt spent 5 years atMoveOn.org, ultimately serving as National Field Director where he developed the

organizations innovative online-to-oine national grassroots organizing model and thesuccessul 2006 and 2008 Get-Out-The-Vote campaigns. Matt also serves on the boardo GreenCorps, the national training institute or community organizers.

MathewRubin Mathew is the President o Spruce Mountain Design and developerand operator o renewable energy projects, including the Winooski One HydroelectricProject. Matt is an outspoken practitioner o environmental sustainability rom oodproduction to electric generation, and consults on hydro projects in New England andglobally. A leading proponent o renewable sources o electricity and supporter o eortsto mitigate the eects o business operations on our natural and social environment, Mattwas a ounding member o Vermont Businesses or Social Responsibility (VBSR) andserves on the boards o Renewable Energy Vermont, the Vermont Independent Power

Producers Association and the Vermont Public Interest Research Group.


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Our First Year Summary o Successes and Challenges

SunCommons inaugural year in the solar business was a dynamic one, flled with greatsuccess and our share o challenges as well. Starting with the good, SunCommon has

made signifcant strides in our mission to make solar available to all Vermonters. Wemade our easy and aordable solar program available in Chittenden County, WashingtonCounty, and Stowe to start, and then opened up Addison County. Our ability to makesolar aordable was wildly popular with Vermonters who have wanted to go solar,but or whom the price had been out o reach. Over the course o our inaugural year,SunCommon installed 169 systems, helping Vermont amilies repower their homes usingrenewable energy.

Due to the widespread popularity o our oering, SunCommon earned a signifcant shareo the residential solar market:

Based on the state permits approved or residential solar in our target counties

since SunCommon launched, we achieved 60% market share; Based on state rebates paid during the calendar year to residential solar

customers, SunCommon had 32% o the statewide total even though we installedin just three counties and only or part o the year; and

Compared to SunCommons 105 rebated installations, our nearest competitor hadjust 29 such installations or 9% o the statewide total. Vermonts remaining 47 solarinstallers averaged 4 installations each during 2012.

Although we achieved many successes in our frst year in the solar business,SunCommon also experienced several challenges along the way. Ater the media launchannouncing that SunCommon had opened our doors, we were inundated with customers

rom across the state who were interested in going solar. This larger than anticipatedbulge strained our limited sta and taxed our ability to provide the excellent customerservice that we strive to deliver.

SunCommon also endured supplier-related challenges. At the start o the year,SunCommons sole provider o solar panels and solar lease, SunPower, experiencedsupply chain and fnancing interruptions that made it difcult or us to ulfll orders andget systems installed and running in a timely ashion. Many o our customers who wereeager to go solar during the sunny months o summer were orced to wait while theseunanticipated delays were resolved.


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And lastly, SunCommon experienced the typical growing pains o a young, start-upcompany. Being new to the solar business naturally presented a learning curve. Theinitial processes that we developed or our operations related to sales, supply, andinstallation had to be adjusted.

Despite the trials, SunCommons determined and innovative sta rose to each occasion.We fne-tuned our processes to streamline operations and better serve our customers.We sought out and partnered with a second panel manuacturer Aleo Solar todiversiy our product oering and shield against our sole-source vulnerabilities. And tokeep up with the immediate and growing demand or solar, SunCommon expanded oursta o 16 ull-time employees to 24 by the years end.

Public Beneft Goals and Outcome

As a Beneft Corporation, SunCommon measures our success by our ability to createtangible public benefts. While there is certainly overlap between our bottom line and ourdesire to do good, this section details our goals rom a public beneft perspective.

INCREASE THE USE OF CLEAN AND RENEWABLE ENERGY IN VERMONT

Reliance on ossil uels has had devastating impacts on the environment and threatensthe ability o our planet to sustain us. The need to move beyond these dirty sourceso energy and actively embrace sustainable practices is the driving orce behindSunCommons mission.

We understand that the switch to renewable energy must be made and thathomeowners, businesses and towns can help lead the way. This is why SunCommon is

dedicated to making the transition to solar power easy and aordable. We believe thateveryone has the right to a healthy environment and saer world and were working totear down the barriers that have made renewable energy inaccessible. We intend torepower our communities one home, one school, and one business at a time so that allVermonters can together create a healthy environment and saer world.

SunCommon is well on its way to achieving this goal as our frst year in business hasresulted in a dramatic increase o solar power in the state. For so long, going solar wassimply beyond the fnancial reach o most Vermont homeowners. Traditionally, the hugeupront costs o solar meant that only those homeowners with the available wealth andtax appetite could choose to power their homes with clean energy rom the sun.


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Today, SunCommons innovative fnancing options have made solar not just a viablealternative, but a cost-eective one that can actually save the average Vermonter money.We have eliminated the huge upront costs o going solar and have replaced them with amonthly payment that is similar or even less than what Vermonters are currently paying

their utility or electricity. In addition, we take on the complicated paperwork associatedwith applying or permits and the states renewable energy incentive, eliminating yetanother barrier or homeowners.

As a result o our easy and aordable program, solar installations across Vermont haveincreased dramatically in the year since SunCommon opened its doors. As mentionedabove, we installed 169 solar systems in 2012. In total, these systems make up just under1 megawatt o solar power in Vermont. In addition, SunCommons strong sales pipelineincludes approximately 93 systems poised or installation in early 2013.

Obstacles

While the public beneft we achieved in our frst year o operation was by most measuresan overwhelming success, SunCommon did experience some anticipated challengesregarding the statewide demand or our oering. Not surprisingly, Vermonters romacross the state have been excited to learn about our aordable solar program. Wevereceived calls rom eager homeowners rom the tip o the Northeast Kingdom to the arreaches o southern Vermont.

However, SunCommons ability to oer an aordable, no-money down solar program isbased on the volume and efciencies we create by concentrating our eorts community-by-community. Doing this allows our evaluators to do multiple home visits in a singleday without crisscrossing the state. Similarly, our installers can ocus their eorts in aconcentrated geographic area that results in increased efciencies. By the end o 2012,we were operating in Chittenden County, Washington County, Addison County, andStowe. As a result, we had to ask enthusiastic homeowners living outside o these areasto wait until we expand our oering to their community.

Although this outcome was anticipated, SunCommon has a deep desire to give allhomeowners in Vermont access to aordable solar power. We are, thereore, eagerlymaking plans or the continued expansion o our solar program and are anxious to workwith Vermonters rom across the state.


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Goalsor2013

ContinuetomakesolaraordableoraverageVermonters Our ability tocontinue to make solar accessible will demand both increased efciencies in our

operations and ongoing fnancing options or the homeowner. In 2013, SunCommonwill continue to fne-tune our operations and streamline our process so that ourcosts can remain low and aordable. We will also work to ensure that our customerscontinue to have a range o dependable and avorable fnancing options that servetheir best economic interests.

Judiciouslyexpandouroeringstootherpartsothestate As mentionedabove, SunCommon is anxious to expand our oerings to the rest o Vermont.However, in order to maintain our efciencies and keep our costs low, we must bejudicious when considering where to go next. In early 2013, SunCommon will openup our services to Franklin and Grand Isle Counties then beyond.

PROVIDE QUALITY GREEN JOBSAs a beneft corporation, SunCommon understands that corporate proft is not the onlygauge o success. Far too many companies today abide by a proft-maximizing ethosthat places employee well-being and morale at the bottom o their priorities. We believethat employees are the heart and soul o what we do and deserve to be honoredappropriately.

Since incorporating just a year ago, SunCommon has hired twenty-our employees whowork out o our headquarters in Waterbury Center. Although were still a young andgrowing company, we have made it a priority to pay our employees well and to oergenerous benefts including health insurance, dental insurance, a 401(k) match, and paidvacation and sick time. We also continue to invest in the proessional development o

our sta by providing relevant training and other opportunities or their continued careergrowth. To this end, SunCommon applied or and will receive a state grant to allocatetowards proessional development opportunities or our employees.

In addition to our twenty-our employees, SunCommons operations have resulted in thecreation o another thirty jobs by our subcontracted installers including Peck Electric andits union workorce. And the signifcant business that we give to local vendors includingbut not limited to graphic designers, ofce equipment suppliers, print shops, attorneys,accountants, insurers, vehicle dealers and credit unions is no doubt having an impacton their ability to keep and hire sta as well.


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Goalsor2013

Expandinstallationcapacity As SunCommon expands to new territories andattracts more customers, we will inevitably have to increase our capacity to installsolar systems. In 2013, SunCommon will work with our existing installer as well aspotentially seek out an additional installer to increase capacity to meet the needs oour growing company. Doing so will lead to new green jobs in Vermont.

Conductananonymousworkersatisactionsurvey We care deeply aboutour sta and want to oster a positive work environment in which employees are notjust satisfed, but are genuinely happy. To this end, we will conduct an anonymoussurvey that gauges sta sentiment toward SunCommon. The results o this surveywill be used to urther improve management, policies, and other employee-happiness-related eorts at SunCommon.

Putinplaceaproessionaldevelopmentprogram As mentioned above,SunCommon will put in place a ormal proessional development program that willnot only provide our sta with the training they need to better do their jobs, but thataids in their broader career growth as well. We have budgeted approximately athousand dollars per employee to be used or proessional development purposesin 2013.

DEVELOP POLICIES AND PRACTICES THAT REFLECT

OUR COMMITMENT TO PLANET AND PEOPLE

SunCommon is deeply committed to our triple bottom line o people, planet, and proft.We are ever mindul that the decisions we make and the products we sell have tangibleimpacts on the environment and our communities. We endeavor to limit those impactswhenever possible and do all we can to leave the world better than we ound it.

Our goal or the frst year o the companys operation was to create a oundation or along-term sustainability program and establish a set o policies and practices that will

guide our commitment to our social and ecological values. Below is a brie summary othe progress SunCommon has made in this regard.

Cratedasustainabilityvision Our sustainability vision describes theprinciples that will guide SunCommons growth and expansion. This document is atool that we will use to develop more specifc strategies, goals, and policies in theuture to ensure that we continue to honor our workers, customers, communities,and environment.

Developedasustainablepurchasingpolicy Ensuring that the vendors wework with and the products we purchase reect our commitment to both planetand people is an important part o our mission. This procurement policy outlinesthe actors that SunCommon and our sta members must consider when choosingvendors and making purchases.

Developedapolicytoreduceourtransportation-relatedootprintTransportation is one o the largest contributors o greenhouse gas emissions in theUnited States second only to electricity.1 In an eort to reduce SunCommonstransportation-related ootprint, this document identifes opportunities to reducework-related travel and oers incentives to encourage employee participation.

1. http://www.epa.gov/climatechange/ghgemissions/sources/transportation.html


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Developedanenvironmentalhealthandsaetypolicy SunCommon iscommitted to providing a sae and healthy work environment or all employees. Thisdocument articulates SunCommons policies and protocols regarding workplaceinjury and illness prevention.

Conductedananonymousbeneftsurvey SunCommon oers a generoustraditional benefts package or our employees including 100% premium coverage

or each employee and a amily member. In an eort to determine i the beneftsoered by SunCommon meet the needs o our employees, we conducted ananonymous survey to determine employee satisaction as well as to gathereedback on any additional benefts that employees would like to see oered.These results will be used to determine uture decisions regarding SunCommonsbenefts package.

AcquiredcertifcationasaBCorporation Current corporate law makesit difcult or businesses to take into consideration other actors beyond proftincluding any environmental or social concerns associated with the companysactions. In addition, there is a lack o transparent standards that makes it difcultto tell the dierence between a values-led business and just green-washing.

B Corporation perormance standards enable consumers to support businessesthat align with their values. Like LEED is or buildings and organic is or ood, BCorporation certifcation or a business tells consumers that rigorous standardshave been met and that were actually walking the walk.

In June, SunCommon became Vermonts ninth certifed B Corporation, joining over530 values-led businesses rom over 60 industries nationwide. In order to earnthis certifcation, SunCommon underwent a thorough assessment administeredby BLab, the independent third-party that created the stringent B Corporationcertifcation criteria. The assessment took a 360-degree view o our businessexamining everything rom employee benefts to wage gaps to in-house energysources. Only companies that score an 80 or higher on the assessment receive

certifcation. SunCommon scored 103 and has already begun looking at waysto urther improve our score (see Appendix A or SunCommons B Corporationassessment).

Obstacles

While SunCommon has made good headway in creating a strong oundation or a long-term sustainability program, there have been challenges that have prevented us romacting on all o our planned initiatives. As a start-up company in our frst year o operation,there was much to learn regarding our business model, suppliers, customer base, andinternal processes. Refning our day-to-day operations has required a concentrated ocusthat has limited our ability to dedicate sta time to long-term sustainability planning. Asa result, several initiatives that we had hoped to complete in year one were necessarilymoved to our second year agenda.

In addition, we have ound recruitment or our Beneft Director to be challenging. Weended 2012 continuing our search or this position and are eager to fnd a candidatewhose qualifcations meet the needs o the company. SunCommon has recently hired ahuman resources consultant to help lead the search or a Beneft Director, with the hopeso flling the position by mid 2013.


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Goalsor2013

Executethepoliciesdevelopedin2012 Now that we have developed oursustainability vision, purchasing guidelines, and other related policies we have toeectively execute them. This includes reviewing them with SunCommon employeesand taking steps to gather sta buy-in, eedback, and compliance.

Continuetoputinplacebasicsocialandenvironmentalpoliciesthatwill

urtherlaytheoundationorourlong-termsustainabilityprogram Thisincludes the development o a waste and recycling policy as well as a communityservice policy.

WasteandRecyclingPolicy SunCommons commitment to limiting ourenvironmental impact includes reducing and reusing our ofce supplies and othermaterials whenever possible, and disposing o hazardous and non-hazardous wastein a sae and responsible manner. This policy will describe the steps that SunCommonand our sta members will take to honor the hierarchy o reduce, reuse, and recycle.

CommunityServicePolicy We believe in the importance and value o communityservice and want to encourage our employees to be active and engaged citizens.This policy will identiy the ways in which SunCommon will support community service

among our sta.

Understandandidentiythepotentialenvironmentalandsocialpitallsothe

solarindustry In striving or continued improvement and to leave the world betterthan we ound it, it is important to acknowledge all o the social and environmentalimpacts associated with the solar industry today. SunCommon will do research to thiseect and will use the results o that research to identiy opportunities or improvementand inorm the development o our uture sustainability e orts.

Examinethestrengthsandweaknessesooursuppliersandidentiyways

thatwecanimprovetogether As a values-led business, SunCommon wants tosupport like-minded businesses that walk the walk when it comes to their social andenvironmental practices. We believe that we have an opportunity to inuence thesuppliers that we purchase rom on a regular basis and we will, thereore, examine theenvironmental and social records o our suppliers and use that data to identiy potentialopportunities or improvement.

Identiykeymetricsbywhichtoannuallyassessoursocialandenvironmental

perormance Our goal is to conduct an annual assessment o SunCommonssocial and environmental perormance. In order to do this meaningully, we must frstdetermine the metrics by which we will gauge our accomplishments and shortcomingsrom year to year. We will review third-party standards as well as annual reports romother respected beneft corporations to determine the key metrics that we will measureour perormance against.

RecruitaBeneftDirector SunCommon will conclude our recruitment and electionor a beneft director. The Beneft Director will serve on our Board o Directors andwill oer guidance on the development o SunCommons sustainability program andsubsequent Beneft Reports.

Conclusion

SunCommon is proud to be one o a handul o Beneft Corporations in Vermont. Ourfrst year o operation has resulted in signifcant public beneft or residents and hasdramatically increased renewable energy production in the state. With our fnancialsuccess, we look orward to our continued growth as a Beneft Corporation as we striveto honor our environment, workers, and communities.


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SunCommon2012 B Impact Report

Company

Score

Average

Score*

Overall B Score 103 80

Environment 41 9

Environmental Products & Services (e.g. Renewable energy, recyling) 30 4

Environmental Practices 11 6

Land, Office, Plant 6 4

Energy, Water, Materials 4 2

Emissions, Water, Waste


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Map of systems sold

by region 4252

4422

18

10

10

13

20

27 22 28

42

5 1

1

11

1

1 11

1

1

1


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helped248 families

go solar with

no upfrontcost

In the past year, SunCommon:

Celebrating our 1st year!

saved the energy of

795 tonsof coal

per year

is saving families

3 Milliondollars

or

2,742barrelsof oil

per year

We believe that everyone

has the right to solar

created

52 jobsforVermonters

Note: This infographicreflects SunCommon'saccomplishments

from March 2012through March 2013.

Join UsAs we work to repower Vermont with 90% renewable

suncommon.com

suncommon's 2012 annual benefit report

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