Green Energy Firm That Says It’s Saved Local Governments Billions Leaves Trail Of Questions

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Luke Rosiak Investigative Reporter

December 17, 2019 9:29 PM ET

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  • More than 1,000 local school systems have hired Cenergistic, a green company that says it will reduce their power bill in exchange for a large cut of the savings.
  • The company says it has saved local governments and schools $5.5 billion, but local officials have repeatedly questioned its numbers, saying it refuses to explain how they’re calculated.
  • Cenergistic is linked to Enron, has quietly put school officials on its payroll to help it get contracts, and is known for quickly ramming through large contracts with no competition.
  • Fairfax County, Virginia’s former schools auditor said that when a whistleblower brought her evidence that implicated Cenergistic as well as top school officials, both the whistleblower and the auditor were fired by those same officials.

A major “green” firm called Cenergistic says it’s saved more than 1,000 schools and local governments $5.5 billion in energy costs, taking portions of those savings as fees.

But a new lawsuit, a decade of government investigations, and news reports show that Cenergistic is an Enron-linked, for-profit company that has allegedly talked its way into no-bid contracts after secretly putting school officials on its payroll, and then billed districts for questionable savings whose basis it refuses to explain.

The contracts are typically awarded by school board members who want to make a statement about environmentalism, and are sometimes exempted from scrutiny on the basis that the money being paid is “free.”

The company teaches “employees how to save money on utility costs by monitoring and assessing usage, and making recommendations for energy conservation such as turning off computers when not in use; turning out the lights when rooms are vacant; reducing the plug load; and turning off vending machine lighting,” the Alabama Advance-Local reported in 2013.

In a lawsuit filed Nov. 1, 2019, the former auditor for Fairfax County Public Schools (FCPS) in Virginia, Goli Trump, said she was fired by school board president Sandy Evans in retaliation for pursuing an investigation into Cenergistic that implicated superintendent Karen Garza as well as Evans herself.

As soon as FCPS created an independent auditor’s office, an employee of FCPS — one of the largest school districts in the country — told her “Cenergistic’s purported energy savings were not true and were in fact costing FCPS considerable sums of money,” the lawsuit said. The whistleblower, known as John Doe in the lawsuit, said he faced retaliation after reporting his concerns to supervisors.

“Moreover, John Doe pointed out that Cenergistic was supposed to receive payments in an amount equal to 50% of the realized energy savings by FCPS; although Cenergistic said it had saved FCPS $5 million, it had billed FCPS $4 million, and John Doe had been unable to find anyone who could explain this result,” the lawsuit said.

He also said “that the Cenergistic contract did not comply with public procurement requirements.” (RELATED: Flint To Rescind Lead-Pipe Contract From Lowest Bidder And Award It To Politically Connected Firm)

Trump attempted to obtain a copy of the contract “from the FCPS contract register, which is supposed to contain a copy of all contracts entered into by FCPS. She learned, however, that the contract with Cenergistic was not available through the contract register, nor could anyone in the procurement office explain why an important contract of this nature for millions of dollars would not be available,” the suit said.

Trump informed the school board’s lawyer, John Foster, about her concerns but requested confidentiality because the ongoing investigation could involve top managers. Foster immediately tipped off Garza, the lawsuit said.

Trump then informed the school board that she intended to audit the Cenergistic contract, but Garza, school board member Janie Strauss, and chief operating officer Susan Quinn told her not to, which she found “suspicious,” given that “the Cenergistic contract presented all or many of the classic indicia of a contract at a high-risk of fraud, waste and abuse,” according to the lawsuit.

On June 17, 2016, a second whistleblower who worked in FCPS’ facilities department contacted Trump and made virtually identical allegations to the first whistleblower. He had no knowledge of the first whistleblower and also provided documents to support his claim, the suit said.

The second whistleblower said he had spent hundreds of hours trying to ascertain the basis for Cenergistic’s bills, but that Cenergistic had refused to explain. “He had no choice but to conclude that the bills and invoices submitted to FCPS by Cenergistic were, in fact, false,” the suit said.

The whistleblower’s supervisor, assistant superintendent for facilities Jeff Platenberg, “harassed him and ordered him to approve payment to Cenergistic despite the fact that Cenergistic’s invoices could not be reconciled or even understood,” it added.

Trump then obtained access to school system emails which showed that “it appeared that Platenberg had been paid to take numerous ‘marketing trips’ on behalf of Cenergistic.”

The emails also showed that “only days after Garza began her employment in 2013, she had been in touch with Cenergistic to discuss hiring them at FCPS.”

Days after Trump obtained the emails, FCPS fired the second whistleblower, and Trump was called in by the human resources department, who told her that an anonymous complaint had been filed against her, according to the suit.

Evans then ordered her not to investigate Cenergistic without approval from superintendent Garza, the lawsuit alleged.

“In a phone call on Aug. 1, 2016, [Trump] informed Evans that she felt she could not do that because Garza was a subject of the investigation and to do that would compromise the integrity of the investigation,” it said.

HR then attempted to physically remove confidential investigative material from the office of the auditor, which is supposed to be entirely independent from the school bureaucracy, the suit said.

“Plaintiff realized the situation was truly becoming critical and began contacting outside law enforcement agencies, including the Virginia State Police,” the lawsuit stated.

Evans prevented Trump from speaking with other members of the school board — collectively Trump’s immediate boss — and Garza told the board that Trump was being placed on leave, according to the suit.

An outside law firm then took over the Cenergistic investigation. “That investigation ended on or about Sept. 19, 2016. Two days later, on Sept. 21, 2016, Garza suddenly resigned from FCPS only two weeks into the new school year and only three months after signing a new contract with FCPS that would last through 2020,” the lawsuit said.

Even so, Trump was fired the next month, leading to the lawsuit filed against FCPS in Fairfax County Circuit Court.

FCPS spokesman John Torre declined to comment for this story, telling the Daily Caller News Foundation: “This matter involves active litigation and is also related to a personnel matter so our policy is not to comment.”

Cenergistic spokeswoman Jan Smith did not respond to questions.

The company has become a major player in the green energy sector. Its website says it “is the EPA’s most active Service and Product Provider for ENERGY STAR building certifications.”

Cenergistic has handled purported billions of dollars in energy for local governments despite years of red flags about its numbers and its relationship-driven sales system that sometimes involves payments to school administrators. (RELATED: Democrats Push A Return To Busing, Despite Their Own Data Suggesting It Doesn’t Help Poor Kids)

2005, Texas

Spring Branch school district superintendent Yvonne Katz resigned after it emerged that she had taken payments from Cenergistic, which until 2012 was called Energy Education Inc. (EEI).

Katz was previously superintendent of the Beaverton, Oregon school district, which also hired the company. She entered a side deal to be personally paid $500 for every meeting she helped set up between Cenergistic and other school districts.

When she took the new job with Spring Branch in Texas, she steered it to hire Cenergistic within four months of her arrival. She did not disclose her relationship with the company to the school board. She received money from Cenergistic during her tenure at Spring Branch, but it wasn’t for arranging that contract, she said, the Houston Chronicle reported.

2009, Massachusetts

Massachusetts’ state inspector general issued an 18-page warning to local governments about Cenergistic. It said that it essentially convinced school districts to let the company write its own requests for proposal (RFP) for the government, and that it wrote them so the only company who would meet the criteria was itself.

It said that Cenergistic required clients to purchase software called EnergyCAP Professional from a company called Good Steward Software LLC, which is run by Steve Heinz, a former vice president of Enron, the energy company at the center of one of the largest accounting frauds in history.

It said that Cenergistic’s founder and owner, William Spears, created a company to purchase the software from Enron and assigned it to Good Steward.

When the Massachusetts inspector general’s office attempted to determine how Cenergistic calculated the purported savings for government agencies, Cenergistic referred it to Good Steward, and Good Steward referred it to Cenergistic.

The watchdog wrote, “Financially strapped school districts find the EEI program option appealing because it precludes capital investment in equipment, retrofits or upgrades,” the inspector said. But “contracts paid for through energy savings are not ‘free’ or ‘no cost.’”

“Since many of EEI’s ‘proprietary measures’ are also ‘common sense’ measures, a public entity should carefully evaluate the consequences of entering into a contract that restricts their option to employ an individual to direct common sense, cost saving and energy conservation measures,” it said.

“Do not enter into a contract unless you: 1) understand how you will be charged for services; 2) will be able to verify these charges: 3) will be able to verify any vendor savings estimates; and 4) understand all contract related costs,” it added.

2009, Florida

The Polk County schools’ assistant superintendent for facilities, Bob Williams, “likely” violated ethics rules by taking $70,000 in payments from Cenergistic for working as a “marketing consultant,” an internal investigation found. The company had a contract with the district. He was later sent to federal prison for taking bribes in unrelated incidents.

2012, California

The Sacramento City Unified School District refused to pay $1.5 million to the company and sued it, claiming the purported savings calculations were flawed. The school board contended the contract never should have been valid because it did not follow proper contracting procedures.

2013, Connecticut

In 2013, Connecticut’s Region 13 school board voted to pay $178,200 to terminate the Cenergistric contract over “concerns and frustrations with the company’s performance and how the savings were being calculated,” Citizen’s News reported.

The company claims it saved the district $161,000 and took $154,000 as its cut, leaving the district with only $7,000.

Some of those savings were likely attributed to measures taken by the school district’s facilities department, not the company, the school district said.

2015, Illinois

The Kaneland school district in Illinois encountered problems after awarded a no-bid contract that was pushed on it by Jack Barshinger, a retired superintendent from a neighboring school district who was on the Cenergistic payroll.

2015, New Hampshire

Windham, New Hampshire school board chairman Jerome Rekart rammed through a $580,000 contract with Cenergestic in 48 hours. When Tom Murray, a facilities committee member, pressed for five minutes to discuss options for saving energy that wouldn’t give away the savings to a for-profit company, the school board called the police, Area News Group reported.

After the meeting, the school system’s business administrator, Adam Steel, acknowledged that the board had not even seen a copy of the contract when they voted on it, Granite Grok reported.

After Murray called attention to the company’s history, it pulled out of the deal, the publication reported.

On Glassdoor, an employee said the company thrives on school boards who “just want good PR and to save money without actually having to make any changes.”

Another employee complained about the company’s insistence on getting contracts by building relationships with specific officials, saying the company “would rather fill the air with green house emissions and fly on an airplane for an hour-long meeting vs. having a virtual meeting.”

The company responded that “we have a relational sales process so direct meetings with prospects are vital.”

HT/macusn

59 thoughts on “Green Energy Firm That Says It’s Saved Local Governments Billions Leaves Trail Of Questions

  1. Saving $5.5 billion for 1000 school districts works out to $5.5 million per district. The article states: “The company teaches “employees how to save money…for energy conservation such as turning off computers when not in use; turning out the lights when rooms are vacant; reducing the plug load; and turning off vending machine lighting”. Sorry, but “teaching” school districts to do the obvious simply isn’t going to save millions of dollars in electric bills. I fault the naïve/corrupt school boards for this one.

    • turning out the lights when rooms are vacant

      Why would schools need to teach that? When I was a little tyke, my father used to holler at me when I left a room at night, “Turn out that light!”

      • “turning out the lights when rooms are vacant”

        There are motion-detecting light switches for under $25 that will turn off the lights after 15 minutes (say) if no motion is detected. I have them in my bathroom and back-stairs landing, and they work well. No need to rely on humans to do the job.

    • And this is why public ran education is a horrible idea and typically leads to waste and abuse. No one has a choice but to fund these public education systems, even if they have no kids or decide to send their kids to a private educator.

      Guaranteed money, or as Adam Smith called it, perpetual funding, leads to unaccountable and wasteful spending, abuse of power, and “crony capitalism” – aka mercantilism back before a de facto Marxist public education system warped and twisted everything.

    • Hmm, seems Cenergistic® is “your Daddy” when it comes to energy use! “Turn the blasted light off, you think money grows on trees?!?!” A search for the company will turn up most every contract they hold – seems they love “press” release promotion.
      Reminds me of ICF the folks that are behind the Washington State underground carbon trading scheme proposed by the Puget Sound Clean Air Agency – whose proposal was written by ICF – a Green Climate Warfare outfit that started as a “great cause” (“Every great cause begins as a movement, becomes a business, and eventually degenerates into a racket.” ― Eric Hoffer)
      Check ’em out on the interweb: ICF.com

      It’s a never-ending job just to keep up with these Red/Green Industries

  2. Any local electrical contractor can provide consultation to anyone who asks for a comparison of alternate energy using devices and systems without charging outrageous fees.

      • Just started my paper work today for my Duke pension because I turn 70 1/2 next year. The IRS requires me to take money so they can tax me.

        When I worked for Duke ethics was important. It is a legitimate business model to help your customers because you understand energy better than school teachers. You are also helping the school district where your children go to school and you pay taxes. We were encouraged to volunteer in school and environmental projects.

        This was true for every company I worked. Good management makes working more enjoyable. At one point I did consider going to work for ENRON. I looked at the two business models which were similar in some ways but something looked off with ENRON.

        One of the other benefits of working with Duke is I still had a pension.

  3. I’m sure it’s a coincidence but my ear worm this morning has been “A Little Tin Box” from the musical Fiorello.

    Maybe society’s greatest enemy is corruption. It’s always been with us and always will be. Folks shouldn’t participate in it, and when they do, the book should be thrown at them.

    Once people tolerate corruption, that’s it for the economy and liberty. A casual look around the world shows that to be true time after time.

    • Wow, that brings back memories. I’d venture to guess that very few have ever heard of that musical. So, yes, let’s put a stop to the sweat shops.

  4. Ho hum. looks like anyone who attempts to scrutinise these contracts ends up getting impeached/sacked.
    Sounds familiar.

  5. “…has quietly put school officials on its payroll to help it get contracts, and is known for quickly ramming through large contracts with no competition.”

    Back in the long ago, this was sometimes labeled “payola”. There is no end to the corruption in the people who do these things. They can be sent to jail for it and it doesn’t matter; they just brush it off, and strike again.

    And I thought Enron had been squelched. Silly me!

  6. Calls to mind this scene from Casablanca:. Captain Louis Renault
    I am shocked—shocked—to find that gambling is going on in here!

  7. Last month I drove through southern California and saw hundreds of wind turbines, 95% of which were still. That was on two separate days. The locals must have been getting their electricity from the nukes in neighboring Arizona

    • California wind farms generally produce most of there power during the summer months. Typically the winds start at about noon and then end shortly after sunset.

      • I thought I’d check on this because the wildfires fed by high winds seem to be fall/winter…I found a website claiming Nov-Apr were the windy months (highest in Dec) in LA and another that said May was the windiest month in SoCal followed by April and June. Seem to be opposite answers.

  8. The only thing that surprises me is how many people act surprised whenever they are presented with evidence of government corruption.

      • There was a very small piece in this mornings news about the FISA court sanctioning the FBI for inaccuracies in their applications for search warrants in regards to the Trump investigation.

  9. As I mentioned in another thread, this whole CAGW is little more than a marketing gimmick. And as well it seems like a great way to keep “consultants” furnished with yachts and gold wristwatches.

    • “Every great cause begins as a movement, becomes a business, and eventually degenerates into a racket.” ― Eric Hoffer

  10. I have had numerous calls from these scam artist’s, wanting to ‘SAVE’ me money on my electric bill. The last time I ran the numbers, I came up with a MIGHTY small saving, if any. My plan is to simply hang up on anyone who wants me to buy ANYTHING over the phone. If I need it and WANT it, I will do my own due diligence research and make my own decision. Most calls like this, including those who claim to be from Medicare are simply full-blown scams. Don’t be apologetic about hanging up. I don’t!

    • Or get a call-answering machine or service and filter your calls. It hlps to get on the govt’s Do-Not-Call list.

  11. The P. T. Barnum saying “There’s a sucker born every minute” seems to ring more true when talking about things Green.

  12. Another Green SCAM. is anyone really surprised that this happened and is happening everywhere? They are just the newest version of Snake Oil Salesmen.

  13. You can tell a State-approved fraud by the fact that it’s allowed to run for a decade without interference, and no-one ever goes to jail for it.

  14. Isn’t Enron heavily related to Al Gore (huge presidential campaign funding and lobbying for CO2 cap and trade scheme) ?

  15. I have seen similar contracts. They either result in over-priced base charges from which “savings” are measured or, more commonly, involve arbitrage in which the risk is on the school board or other government entity which has no expertise in electricity pricing or arbitrage.

    • Sounds like the same way in which renewable energy itself is touted – capacity factor rather than real production. They had the “capacity” to save that much money by following their no-brainer suggestions, ergo, they are owed real money for conceptual savings.

  16. Anyone who thinks the “green” in Green Energy schemes is in reference to the color of plant chlorophyll is a knave.
    Anyone listening to someone pitching Green energy, Green jobs, Green New Deals better hold onto their wallet because they’re being hustled.

  17. Remember, first thing lefties manipulate are numbers. So anything you see about numbers (like amounts of money) are guaranteed lies.

  18. I saved about $30 on this month’s utility bills over this period last year by installing a ventless gas-log burner in my fireplace. It should pay for itself in about two years on top of the ascetic appeal and convenience it provides.
    Turns out they have been using these ventless systems in nations like Japan for decades. Imagine the savings that could be had if our public schools utilized them, and now that I have recommended it, if they do actually use them then by my accounting each school district would owe me $5,000,000.

  19. This lady is confused. Nothing to see here.
    The product being sold is a virtue signal, not energy savings. Any fool knows to turn off the lights when you leave the room. What the school boards are paying for is the appearance environmental action and some graft kickbacks.
    The money comes from the taxpayer anyway, so it is free in their eyes. No problem if the was no real benefit.

  20. This “No Cost” contract scam is just a way to circumvent contract oversight. It is EXACTLY the same scam as the one where leftist organizations install lawyers to work at state and city attorney general’s offices for “free”. They get to direct government investigations with full governmental power while being under the direct control of outside entities.

    Not only should these practices be prohibited, the perpetrators of the attorney general scams should be prosecuted for fraudulently acting under color of governmental authority where none exists.

  21. “The company teaches “employees how to save money on utility costs by monitoring and assessing usage, and making recommendations for energy conservation such as turning off computers when not in use; turning out the lights when rooms are vacant; reducing the plug load; and turning off vending machine lighting,”

    Wow !! Just WOW !!
    And fools fall for that.

  22. The Washington State Energy Code (commercial) requires lighting controls that automatically turn lights when they detect tooms are vacant. Controlled receptacles (shutting off non critical loads during unoccupied periods) is a requirement as well. Public buildings are required to follow the commercial code. There has been a requirement like this since 2015 and at least two previous versions of the code. The WESC is not unique. So, in at least some of these projects, Cenergistic is taking credit for compliance with local codes.

    • “Cenergistic is taking credit for compliance with local codes.”

      Yes, in keeping with the general scamminess of Big Green.

      Much like the UK taking credit for closing coal mines that it was doing anyway, or Germany taking credit for closing badly factories, etc. in the former East Germany…

      Personally when camping and everyone is busy with their chores, I want credit for keeping Sasquatch away with my psychic powers…

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