better word. He remembers a moment during his journey to
the West, on a train between Rome and Milan, when his heart
leaped at the sight of a set of belching smokestacks. “Because I
felt, ‘Oh, maybe one day I’ll be working on a power plant!’ ” he
recalls. “Even now, when I go in a power plant, I feel like I’m
in an environment that I like and I want to be in.”
His degree yielded a job at Bechtel, the American construc-
tion behemoth that built Hoover Dam—and most of Saudi
Arabia’s infrastructure. He also worked at the Swiss engineer-
ing giant Brown Boveri (now ABB) and at Fluor, another
American design-build titan. There Polsky helped design what
are called cogeneration, or co-gen, plants, which run on natu-
ral gas and generate heat and electricity simultaneously.
Then, a change in U.S. energy policy would change his life:
the passage in 1978 of the landmark Public Utility Regulatory
Policies Act. Purpa broke up the local utility monopolies by
encouraging public and private companies to build power
plants and sell electricity to whomever they chose. This movement toward deregulation—airlines would soon follow—“caught
my imagination,” Polsky says. He saw immense potential and
tried to persuade his bosses at Fluor to get into the business
directly, rather than simply design plants for others. Fluor was
wary of competing with customers and demurred. Frustrated,
Polsky left, and in 1985, he co-founded Indeck Energy Services.
He was fnally doing what he had always dreamed of—
building his own power plants. The pace was thrilling. Indeck
soon topped $100 million in value and made the Inc. 500 list
of America’s fastest-growing private companies three times,
reaching No. 2 in 1993. But by then, Polsky had had a falling
out with his partner, which led to his being dismissed from his
own company. Lawsuits ensued, an arbitrator ruled, and in
1995 Polsky walked away with a reported $20 million settlement. Richer and wiser, he was eager to begin again.
And again his timing was perfect, given that the last decade
of the 20th century was an ideal period to be restarting in the
power business. The looser regs, rising energy demand, and
cheaper natural gas prices fueled a wave of new construction.
Polsky and a new partner, Murphy, founded SkyGen Energy,
to ride that wave. They moved beyond cogeneration into so-called peaking plants—large, gas-powered generators capable
of fring up in minutes, designed to meet spikes in demand.
SkyGen’s big initial challenge was one Polsky has faced
his whole career: raising capital in a business that demands
stupendous upfront investment. His competitors were either
regulated utilities, which can recover costs through rate
increases; or public companies, blessed just then with soaring
valuations and access to capital markets. Polsky’s approach, by
default, was build, sell, reinvest, repeat. “We eat what we kill,”
he says. “We don’t have a parent who cooks for us.”
Stymied, he hired an investment banker to review his
options. Going public wasn’t one of them; Polsky knew he
didn’t have the temperament for that. He also looked at joint
ventures. In the end, he decided on an outright sale. That’s
when Calpine stepped in. SkyGen’s takeaway in 2000 was
$650 million, net of debt. In retrospect, he looked like a
genius. Gas prices soon spiked, the economy slowed, credit got
tight, and suddenly the formerly high-fying power industry
was scrambling to get out from under mountains of debt.
A year later, Polsky stepped out on his own again to form
Invenergy, with the goal of relieving those debt-burdened
companies of some of their power plants, at appropriately
Invenergy sank $40 million into
Buffalo Mountain and lost $6 million.
Polsky insists it was money well spent.
56 - INC. - NOVEMBER 2017