Volume 11 No. 1 SPRING 2010

Smith Businesses to Watch For


George AshtonYou know the old adage "make hay while the sun shines?" George Ashton, MBA '06, knows that you can make energy while the sun shines--and a tidy profit, too. Ashton is a pioneer in the solar renewable energy credit market. Sol Systems, the business he co-founded with partner Yuri Horwitz, trades in market-based solar subsidies. By helping people recoup the cost of installing a solar energy system, Sol Systems is also helping to make solar more affordable for businesses and homeowners.

Sol Systems sells and manages solar renewable energy credits, (SRECs), tradable credits that represent the clean energy benefits of electricity generated from a solar electric system. Each time a solar electric system installed in a home or business generates 1000kWh (1MWh) of electricity, an SREC is issued which can be sold or traded. Power companies purchase SRECs to meet their state's renewable energy requirements. The values of SRECs can vary dramatically from state to state depending on the supply and demand of the credits in that state and by how much the state requires utility companies to pay when they don’t use enough solar power. Sol Systems helps businesses and homeowners register their solar power systems and then purchases their SRECs, re-selling them to power companies across the region.

Like the cap-and-trade system being proposed to control the emission of greenhouse gases, SRECs are a market-based incentive that can bring about a valuable societal change in advance of government regulation.

"Sol Systems is creating a solar credit market in the city of Washington, D.C. We're the biggest player here and we’re helping to make renewable energy more affordable for consumers," says Ashton. "We're involved in many other states as well, from Michigan to Massachusetts to North Carolina."

Ashton has always chosen careers that included a component of social value creation. He worked for Fannie Mae in the sale and trading of mortgage-backed securities earlier in his career because "it married capital markets with social responsibility." During that time he pursued an MBA through the Smith School's part-time program and started seriously considering what it would take to start his own business with good friend (and Sol Systems co-founder) Yuri Horwitz, a renewable energy attorney.

Both men were driven; both had a hunger to contribute to the betterment of the world. "Yuri and I would say we got that hunger from our mothers," says Ashton. "My mother instilled in me the desire to help other people and the planet. It's a choice. Do you just want to give $10 a year to charity? Or do you want to have more of what you do and who you are involved in something that makes the world a better place?"

The skills he learned in business school were stepping stones to Ashton’s big dreams. He found the Smith School’s systemic approach to teaching management—integrating many disciplines into a big-picture view of the organization, particularly helpful. “The best thing I learned at b-school was combining corporate finance with accounting with strategy. Wrapping all that together was really important, so that when you make a decision you can take into account all of the consequences and benefits,” says Ashton.

Ashton also found the Smith School to be a great resource as well. Ashton was very appreciative of the advice offered by Ben Hallen, assistant professor of management and organization, and Asher Epstein, managing director of the Dingman Center for Entrepreneurship, when Ashton was approaching venture capitalists and thinking about how to grow his business. Sol Systems is applying those lessons learned to engage investors and strategic partners.
Ashton sees plenty of room for growth, because states are stepping up to facilitate a good deal of solar development over the next 10 to 15 years. "We see ourselves as a financial intermediary within the solar space. We're not interested in cashing out and going to sit on a beach somewhere," says Ashton. "We want to stay involved and help renewable energy succeed so that we can ultimately enable people to protect the environment and our planet for future generations.”

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