Expanding its reach

Real Goods Solar, a Mendocino County solar energy pioneer, has filed plans to sell $57.5 million in stock in a bid to consolidate the fragmented solar power industry.

The Hopland company, in papers filed with the U.S. Securities and Exchange Commission, revealed it has already purchased two competing businesses in recent months and more acquisitions could follow.

"Our goal is to continue to build on our industry-leading position and be the largest and most profitable residential solar energy integrator in the United States," Real Goods Solar stated in its filings.

Company officials would not comment on the public stock offering or expansion plans, citing a "quiet period" on statements before the stock sale. The date of the stock offering has not been set.

The solar market is growing significantly, particularly in California where the state began offering $3 billion in subsidies last year to put solar electric systems on a million rooftops over the next decade.

Many solar companies, from manufacturers to system installers, are small, private firms with limited resources. Real Goods and a handful of larger firms are expanding by purchasing smaller companies or opening multiple offices in the state.

"That's just another sign that solar is taking off and that's good to see. That's what we're trying to do, create so much demand so there's enough business for everybody," said Marty Roberts, program director for Solar Sebastopol, a group promoting solar as a viable alternative energy source.

Founded in 1978 by John Schaeffer, Real Goods Solar designs, purchases and installs solar energy systems for homes and small businesses.

Schaeffer, who remains chief executive officer, sold the eco-retailer in 2000 to Gaiam, a Broomfield, Colo., company that produces DVDs, CDs, books and catalogs on lifestyles and healthy living. Real Goods Solar is a wholly owned subsidiary of Gaiam.

In its three decades of operation, Real Goods Solar has installed more than 2,400 residential and small commercial solar energy systems and sold a variety of solar products to more than 30,000 customers. It employs 83 people.

The Hopland company would have generated $32.7 million in revenues and $491,000 in profit last year, including the results from its two recent acquisitions. In 2006, it reported $16.8 million in revenues and $250,000 in profit, according to its SEC filing.

The company's Solar Living Center in Hopland has drawn 2 million visitors to view environmental technologies and interactive demonstrations since it opened in 1996.

"I think the awareness about global warming is a big part of it. There's also more aggressive activity by groups like ours and companies to make solar energy more visible," Roberts said. "It's catching on big time."

Growing energy demand and the prospect for higher electricity rates is another reason solar is a solution for a growing number of homes and businesses, Real Goods Solar stated in its filings.

The Real Goods Solar strategy is to expand into new markets where competitors have little brand recognition and target states with financial incentives for installing solar. The company also could continue acquiring competing businesses, according to its filings.

In November, Real Goods Solar purchased Marin Solar based in San Rafael. In January, it acquired Carlson Solar, in the Southern California town of Hemet. Those two companies have installed about 1,000 solar energy systems, and together tallied $13.8 million in net revenue in 2007.

The high cost of installing solar energy systems could be a barrier to the company's expansion plans, according to the SEC filing. The typical California homeowner, for instance, spends between $15,000 and $30,000 for a solar energy system after rebates and federal tax credits, according to its filings.

Also, a global shortage of silicon, the essential material for solar panels, has pushed up prices, according to its filings.

The company intends to apply to have its stock traded on the Nasdaq Global Market under the symbol "RSOL."

You can reach Staff Writer Michael Coit at 521-5470 or mike.coit@pressdemocrat.com.