Invenergy LLC - Strategies, Solutions and Best Practices for Business Leaders

The winds of change in the energy industry seem to be originating from the Windy City. Not only did Chicago produce President Barack Obama – who has pledged to invest in clean and renewable energy – but it is also the home of Invenergy LLC. Since its inception in 2001, Invenergy has become one of the leading firms in clean and renewable power generation in the United States.

Invenergy is at the forefront of reinventing America’s power grid, developing wind power generation and other forms of renewable electricity across the country. With more than 2,000 megawatts’ (MW) worth of wind generation projects currently operating and more than 450 MW under construction, Invenergy is one of the top-five wind generation developers in North America, according to the American Wind Energy Association’s 2008 annual report.

What’s even more impressive about the company’s accomplishments is that it has risen to its current position as a privately held firm. Senior Vice President of Development Jim Shield says the company is the largest private wind power developer in the United States, which gives it advantages over its publicly held competitors.

The company is looking forward to the Obama administration’s energy policies, because the federal economic stimulus package aims to provide significant resources for clean energy projects such as Invenergy’s Grand Ridge wind farm in northern Illinois. Once the economy recovers, Shield says, the wind energy market will likely continue to grow and generate jobs in the United States.

Power Portfolio
The company was founded by President and CEO Michael Polsky, who has more than 30 years of experience in the energy industry. This includes cofounding one of the first independent power producers, Indeck Energy Services, in 1985. Prior to establishing Invenergy, Polsky founded SkyGen Energy LLC, building up a portfolio of 12,000 MW of power-generating projects.
Invenergy focuses on developing, operating and managing large-scale renewable energy-generation assets in North America and Europe.

The company has development offices in Austin, Texas; Denver; Minneapolis; San Diego; San Francisco; and Washington, D.C., as well as international offices in Canada, Scotland and Poland.
Shield says that one of the company’s main advantages over its competition is its organization. Not only is the company small and flat enough to be flexible, but it concentrates on renewable energy. Many other renewable energy developers are traditional power generators trying to adapt to the new models, but Invenergy isn’t tethered to the past. “This is our core business,” Shield says.

A flat organizational structure and entrepreneurial culture help Invenergy make the most of its management’s average of 20 years in the business. Because Invenergy has the flexibility to act quickly, it can spot trends and reallocate resources to take advantage of them before others have a chance to react. “We can make decisions quickly here,” Shield says. “If one person spots an opportunity, we get everyone involved to take advantage of that opportunity.”

Fast and Lean
Once the company identifies an opportunity for a potential generation project, Invenergy’s engineers and developers go to work. The teams scout the site first, measuring the feasibility of establishing a wind generation facility there. “A big thing with the projects is transmission, getting your power to market,” Shield says, adding that a transmission team examines the ease with which a potential project would be able to supply its power to the market.

Invenergy has the advantage of experience and a fast reaction time, but the company also has the added edge of foresight. Because Polsky began focusing on wind energy development in 2001 – before many of the major players began to take it seriously – Invenergy has been able to stake its claim ahead of the pack, according to Shield.

“As we’ve built our business up over time, we have the advantage of having started years earlier in the wind business, and got some favorable sites,” he says. The company was also able to secure a significant supply of wind turbines from General Electric before the start of the wind energy boom.
“We took the risk to secure a supply of equipment, and that has worked out well for us,” Shield says. With a ready-made supply of turbines, Invenergy was able to hit the ground running in developing some of its properties without having to wait around for equipment to arrive.

Stimulated Business
Invenergy has been able to get a good head start on the wind power industry, but in some areas, its progress has been stymied by outside factors. Shield says the lack of a cohesive national energy policy has resulted in a patchwork energy policy that doesn’t allow for a uniform energy market. He says this does very little to promote new energy projects and investment in them. “Policy is almost state-to-state, while energy markets are regional and national,” he says.

The company does see reason to be optimistic for the future, however, given President Obama’s goal to reduce the nation’s dependence on foreign oil and increasing the amount of power generated by renewable sources in the United States. The economic stimulus package has provisions for renewable energy projects, including expanded tax benefits. Shield says Invenergy’s Grand Ridge Energy Center wind project will be one of the first projects to benefit from the stimulus plan.

Thanks to tax credit extensions and stimulus funding, Invenergy will be adding 74 new 1.5 MW General Electric wind turbines to expand Grand Ridge to produce an additional 110 MW of electricity. The added capacity will enable Grand Ridge to supply clean power to more than 30,000 households, according to the company. “In a long-term strategic viewpoint for the United States, renewable energy makes sense, not even accounting for the environmental benefits,” Shield says. “When you look at wind – and these projects will be economical for years to come – you’ll have free fuel.”