Solar entrepreneur says he's shut out of rebate program

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Engineer Mouli Vaidyanathan, owner of SolarPod, can’t qualify his products for a state of Minnesota rebate program because his company lacks the proper certification.

Photo: NEAL ST. ANTHONY • Star Tribune,

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Mouli Vaidyanathan, engineer and solar-system entrepreneur, has hot words for the Minnesota Department of Commerce, which he believes is using a 2013 state law to protect two larger operators, Bloomington-based TenKsolar and the Minnesota operations of Washington-based Silicon Energy.

Vaidyanathan, owner of Solar Pod (www.MySolarPod.com), said he’s sold about 100 “plug-and-play” solar systems outside Minnesota through retailers such as Menards and Northern Tool and Equipment. The average unit price has dropped from $4,000 to $3,200 over the past couple of years as volume rose and production costs dropped through local contract manufacturers. But he says he can’t compete in Minnesota against higher-priced competitors who benefit from the generous state and Xcel Energy subsidies.

The Commerce Department and Xcel Energy haven’t certified Solar Pod for their programs, Vaidyanathan said.

“We qualify as ‘Made in Minnesota’ because of the statement in both the 2010 and 2013 bills that says ‘by interconnecting low-voltage direct current photo voltaic elements that produce the final useful photo voltaic output of the modules,’ ” Vaidyanathan said. “I do that production here.’’

Between the federal and state tax breaks to buyers and utility company subsidies, a growing number of Minnesota residential and commercial customers have paid less than a third of the retail price for their systems, as government tries to spur production that helps drive down the cost of the emerging U.S. solar industry.

“The department strongly supports the growth of Minnesota’s solar community and highly appreciates Mouli’s entrepreneurship,’’ said Anne O’Connor, communications director of the Minnesota Department of Commerce. “Unfortunately, in this situation, the statute clearly states that without the ‘UL 1703’ certification, products are ineligible for certification under this [rebate] program.”

Vaidyanathan said the 2013 bill requires Underwriters Laboratory certification at Minnesota manufacturing facilities, even though the Solar World plant in Oregon, where he gets solar panels, already has UL certification. And he can’t afford “duplicate certification” at the factory in Minnesota that assembles his solar pods. Thus, he asserts, the law effectively protects the two larger competitors.

“We built our company here and got the UL certification here,” said Joel Cannon, CEO of 85-employee TenKsolar, which does about 15 percent of its business in Minnesota. “We were instrumental, and that law has been helpful to us. But the law was written so that you couldn’t buy completed parts from factories outside Minnesota and screw them together in Minnesota and call them ‘Made in Minnesota.’ ”

Vaidyanathan, who holds a doctorate in metallurgical engineering from the University of Wisconsin and is a veteran of two big electronics concerns, recently installed his first rooftop unit, Solar Pod Crown, in Sunnyvale, Calif. He says it’s revolutionary and less expensive because the system doesn’t require compromising the roof with penetrating bolts or screws.

Century-old American Rug Laundry on E. Lake Street holds a sale

Sam and Farzan Navab, immigrant entrepreneurs and longtime owners of Oriental Rug Co. of St. Louis Park, are having a rug sale of a different sort.

The 10-day sale, which began Friday, is at their American Rug Laundry, the 97-year-old business on E. Lake Street that they bought in 1999.

The century-old building needs a new roof, windows and brick-facade repairs. Sam Navab says the cash flow from the 11-employee business doesn’t generate sufficient funds to cover the capital investment. Their banker is standing by with about $100,000. Sam Navab says he hopes the sale generates at least $200,000 in proceeds that will be dedicated to refurbishing the building.

The plan has the support of the Lake Street Council, which wants to preserve the 1917 building and plans to provide a small grant to help fix the historic facade.

“I don’t want to sell the building and move to the suburbs,” Sam Navab said. “Our customers are there, including people in their 80s who remember bringing rugs to be cleaned with their grandparents. We have invested hundreds of thousands in state-of-the-art equipment and the only centrifuge machine locally to spin large rugs. Unfortunately, we neglected the building while we turned around the business.

“So, instead of looking at all these rugs in our inventory, and I’ve been looking at some for 10 years, we’re going to sell them at cost or 10 or 15 percent over cost, and, hopefully, we’ll be cleaning them in a few years. We’re selling everything that’s handmade and imported, with 8-by-10 foot dining room rugs selling for $900 to $3,500. We have set some money aside and we have a bank loan commitment. The work on the building will start this spring.” The Navabs also have a small rug-manufacturing business, Legacy Looms in International Market Square.

UST business school makes the Big 100

For the first time, the University of St. Thomas Opus College of Business is one of the 100 best full-time MBA programs, according to the annual ranking by U.S. News and World Report.

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  • Farzan Navab, standing, and Sam Navab of American Rug Laundry Minneapolis and Oriental Rug Co.

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