GreenTrendSpotter

Long before solar energy became mainstream, Barry L. Butler was into it. Deep into it.

The owner of Butler Sun Solutions Systems Inc. in Solana Beach, which makes equipment for solar water heating, worked for the solar program at Sandia National Laboratories in Albuquerque, New Mexico, starting in 1972. He researched concentrating solar power using parabolic dishes and other means.

At the time, he also served on the Solar Energy Industries Association’s board of directors. Throughout the years, he continued doing research in the field, both professionally, and on his own time as a hobby.

In 2002, he retired from SAIC where he worked on solar-powered Stirling engines, the same technology that SDG&E wants to use to generate electricity in the desert as part of its Sunrise Powerlink project.

After retirement, he formally launched his company. Butler Sun Solutions sells kits that enable people to convert their existing tank from being heated by gas or electricity to being solar-powered. A central component of the tank is the Solar Wand Heat Exchanger, for which he has gotten a patent.

He estimates his company has sold some 500 wands over the past six years, many to do-it-yourself types who live outside of California in states like Arizona, which he said, has better incentives for solar heating.

Ironically, he doesn’t do much business in San Diego because he said the city and state policies have been unfavorable to solar water heating.

For example, he said the cost of a city permit to install a $6,000 solar water heating system is $336 whereas the permit for installing a $25,000 photovoltaic system is $106. To get the state rebates for solar water heating, he said, requires jumping through multiple hoops, including costly inspections.

Butler has a PhD in materials science and is well-versed in both the science and politics of renewable energy. One of his sons helps him run the business.

I recently interviewed him about his business. The following is a condensed version of the interview:

Q:  What inspired you to create the Butler Sun Solutions?
I was on the board of directors of the Solar Energy Industries Association. I was there for concentrating solar power. I wasn’t really there for solar water heating. But at the time, in the early 1970s, there were a lot of systems out there that were being put there by plumbers. They would go buy solar collectors from one place, pumps from another and  something else from a third party, and they were putting these systems together without any real knowledge of how the pieces would play together. People were putting in absolute junk.

There was a gentleman at the Department of Energy who said in a meeting, “What we need is packaged system, where all the pieces play together and people would buy from someone and it would work.”

So I thought about that and said “Yeah, what is needed is a packaged system, where all the pieces are designed to work together. At that point, I started putting together a packaged system. The first one was actually about 1984. And the first one that is of the generation we sell now was put together it in 1986.

Q: You must have been one of the pioneers in San Diego when you started out. Were there any people out there doing these types of systems?
In San Diego, there used to be a group called the Solar Energy Association, San Diego chapter, headed by a guy named Mike Landry. It started in the early 70s. I didn’t join until 1984.  Mark Naylor and Karl Holmberg, those guys were all selling solar systems since the early 1970s. I met them in 1984. There was an active group selling and installing solar hot water systems even though the business had sort of died in 1980.

Q: What happened in 1980s?
What happened was there were tax credits. Countrywide, they were selling 80,000 systems a year. Then Reagan came into office and wiped out all the tax credits for solar and renewable energy. The next year, the actual number of installs went down to three or four thousand, and most of them were in Hawaii where they were desperate for energy.

Since then, there’s been repairs of systems that are out there. Small numbers of installations a year in the solar hot water business. but huge numbers of installations in pool heating. Many of the guys survived by doing pool heating, servicing the existing solar systems and selling new ones.

Q: How did your interest in solar energy first begin?
My interest in solar started in 1972 when I was working at Sandia National Laboratories  in Albuquerque, New Mexico. I was part of the solar program down there. I started working on solar energy in 1972 for the federal government. At Sandia, they built the power tower, parabolic dishes and parabolic truss _ lots of solar concentrating stuff.

Q: The holy grail of making solar more cost-effective involves improving the amount of energy collected from the sun. Are we there yet?
The way I see it, solar energy is already cost effective compared to coal and natural gas and oil. The problem is that they are all subsidized. They do not pay any carbon tax. They don’t pay for any of the pollution they cause. All they do is just charge you for getting the coal out of the ground, burning it and getting you the power

As a society we’ve tolerated them using the atmosphere as the sewer. They are making electricity charging 18 cents a kilowatt hour for it and then throwing 45 cents per kilowatt hour into the atmosphere that we have to deal with later.

Solar thermal could be generated for about 20 cents per kilowatt hour and consumers would pay about 25 cent. Solar is already cheaper than other forms of energy. The problem is the other forms of energy are getting an exemption from dealing with the consequences of  the exhaust.
 
Q: Do you think a carbon cap-and-trade system will be created within your life time?
I’ve been waiting for this for a long time. I see the change coming because people are  now realizing it’s our nest we are destroying.

The Bush administration has been so bad, because they’ve squandered the opportunity to do something useful about climate change and greenhouse gases. Those guys had argued that the oil companies are king, they run Washington and they don’t want to pay a sewer tax. A sewer tax is going to be absolutely necessary.

Q: What measures would help the United States build a green economy?
All you have to do is apply the true cost of energy production to everything. Either take away the subsidies from oil or gas or you are forced to subsidize everything else.

I don’t believe you do it with a cap-and-trade system because it leaves too much room for the politicians to favor their friends. What you should do is a straight carbon tax based on the amount of carbon in fuel. A straight carbon tax means the less fuel you use, the less tax you pay; the more fuel you use, the more tax you pay.

My faith is that the American people will respond appropriately once they’ve been given the appropriate signal. They’ve had their gasoline subsidized. They have had their energy subsidized, and they are used to getting more for less. Now they are going to have get used to getting less for more.

Q: Do you see San Diego developing a clean tech sector, similar to the wireless telecom industry and the biotech industry here?
Yes. We do have the California Center for Sustainable Energy here. Irene Stillings (executive director of the CCSE) has done a good job attracting the government money and focus onto San Diego.

I just completed a study with Richard Caputo that shows there are applications to the Bureau of Land Management permits to build solar plants in San Diego and Imperial counties that can generate 29,000 megawatts of power.

Not all of them will get funded because of the financial meltdown, and the other things that have happened since these people made their applications. We feel that it’s very easy for San Diego to get half of its energy from renewable sources within San Diego and Imperial counties combined

Q: How much of a hit do you think clean tech is taking because of the economy?
We’ve been wrestling with that. We have a couple of start up businesses we are getting financing for. Certainly, the meltdown has changed the dynamics of this financing. but it hasn’t’ destroyed it.

There are a whole bunch of people out there who want to get on board with the next economy. Those people are relatively small investors who are actively looking for investment opportunities  in renewable power. They see that as a way to make their portfolios grow. There are companies now that are raising money just to invest in renewable technologies, like Nth Power and Silvermine Capital and are doing very well with renewables.

The interest from venture people’s gone up. They are seeing clearly now,  at least the venture people seem to be seeing clearly, that the old economy, business as usual isn’t going to cut it.

The new buzz phraseology in Washington is all about the carbon constrained economy. The carbon constraint will force people to change their behavior. The problem is us, not the politicians. We are starting to do the right thing; we are buying Priuses and not gas guzzler.

Q: What are the challenges of running a small business when there is growing competition in the clean tech sector?
The real thing that keeps the small business alive, and has always, is customer service. It’s really that personal contact and the ability to provide service that keeps small business going.

Q: Where do you make your systems?
We’ve insisted on buying locally, even though the Chinese have said we can make that cheaper and better for you. That’s not the business we are in.

We feel that our fundamental obligation to the community is to create jobs and taxes and create employment for people here in the country. We are not buying stuff from overseas. We buy everything in the U.S.  That make sour system more expensive. The people we deal with want to create jobs in the U.S. They are not interested in creating jobs in China.

Q: You have an installation manual online. Do you have a lot people who buy it and do the installations themselves?
I would say 80 percent of our sales are not installed by us. Instead they are installed by the customer who buys it somewhere else in the country. Our manual must be good enough. The average is one call per installation.

Q. The Solar Wand Heat Exchanger is a key component in your system. How did you come up with it?
That was the whole idea, a packaged system. You can use the customer’s existing water tank. What we were looking for was a way to basically modify the existing water tank, so you didn’t have to buy a new one. Most solar people were out there selling a new tank. So what we do is we found out that we could have a much less expensive installation by just using the customer’s existing tank.

Q: Where are most of your customers from? Are they all domestic?
We don’t do much shipment abroad because we haven’t advertised much there. We do sell quite a few in Canada. We have a couple of distributors in Canada. Most of our sales are in the United States, and some in Mexico.

Q: Do you have big plans to expand?
We have one space, and we are moving into two more. We are growing to six thousand square feet here. We have college students who work with us in the summer time. We expand our workforce in the summer to educate the young people.