The Rising of Sun City Solar
The Rising Sun City, April 11, 2008, Kirby Lee Davis, The Journal Record
Fueled by 1980s federal tax credits for solar energy investments, Sun City Energy Systems of El Paso mushroomed from one to 11 stores across four states in just two years.
Now Sun City burns bright once again, aided by a 2005 federal tax rebate program, soaring fuel prices that renewed interest in energy alternatives, and increasing discretionary spending from Oklahoma’s oil boom.
Last year revenues jumped, with the Tulsa company adding a dealership in Springdale, Ark., under investors Dwight Stinchcomb and John Gerrard.
Speraw added an Oklahoma City dealership under Chris and Ctaci Gary on Feb. 1 while landing the Tulsa’s first large-scale commercial contract, installing solar panels on the Keener Oil and Gas headquarters.
That March deal – marking the first commercial customer in Tulsa that Public Service Co. of Oklahoma has allowed to tie into its grid – has spurred more than seven inquiries that led to site inspections and proposal evaluations.
Fielding potential dealership investors from Colorado Springs, Kansas City and other locations, Sun City intends to limit that expansion to one every six months.
“We need to be able to fully manage our growth,” said Speraw, who this year changed the company’s name to Sun City Solar Energy, adopting a new logo to emphasize its solar power foundation. “So that we can fully help them to succeed, we need to be available to them when they need us.”
As dealerships instead of franchises, Speraw requires investors make only a one-time training fee determined by the size of the market. She then helps them get off the ground, providing ongoing training to help them establish and operate their business. Speraw also contracts her installation and repair teams to dealerships, until they create their own departments.
” We have a team here. We’ll always be improving and growing. It’s a team effort.” Behind that team stands her family, which was raised in the business. Speraw sees that as her strength. “Everybody in the family knows how to install, including me,” she said. Pam Speraw, who launched the original Sun City chain, is head of business development. Her brother Garret Roth oversees installations and most service needs.
She also gives credit to the 2005 federal tax rebate program, which provides a 30-percent investment credit capped at $2,000 for a residential solar hot water or power system, with no cap on the 30-percent credit for commercial system investments. This year’s possible expiration of that program concerns her far more than talk of a national recession.
Costs vary from project to project, ranging from about $3,000 for a solar pool heater to $65,000 or more for a residential power generation system. The return on investment also varies, although she said a pool heater will often pay for itself within two or three years.
Sun City’s strong sales have carried over to its dealerships. “It’s been going great guns,” said Gerrard, whose team has finished several installations since its October launch. “From a standpoint of a startup business, I think we’ve exceeded where we thought we would be at this time. We’re making more contacts every day.” While that hot northwest Arkansas economy is settling somewhat, Gerrard said the leveling has not affected their business. “There was some overbuilding in the commercial sector and larger homes,” he said. “We’re mostly concerned with retrofitting. Only about 20 percent of what we do is with new construction.”
Chris Gary said his Oklahoma City office at 7540 Berkley Ave., just east of N. May and Grand, has already made installations, with several deals pending. “For people not really knowing anything about us, we feel that’s really good,” said Gary, who has yet to set projections for the year. “We haven’t started advertising here yet. We’re starting advertising this week, as far as radio spots. “Anytime you open up a business, it’s going to take a while to get you up and running,” he said. “I feel happy so far with what we’ve been doing.”
Speraw draws much of her enthusiasm from the educational side of the business. Her seminars, often held at Sun City’s 6709 E. 81st St. showroom, focus on information and analysis, with no sales pressure. That’s one reason why her presentation won accreditation from the American Institute of Architects. “First and foremost, we want to educate the consumer,” she said.
“A lot of people are surprised to hear the average home puts out more CO2 than a car. She uses that as supporting evidence for installing a solar water heater, saying a family of four using electricity from coal or oil creates the same pollution as a car driven 40,000 miles per year. Looked at from the other direction, she said solar water heating systems keep 7,200 pounds of carbon dioxide out of the air each year. But those seminars also prove Sun City’s greatest marketing tool, with 75- to 80-percent going on to buy some solar product – often for new home installations. “It’s our best source of customers,” said Speraw, one that spurs heavy repeat business. “Once someone invests in our solar products, they will almost always end up owning all of them.” Copyright © 2008 The Journal Record