This article is part of our Rising Stars Portfolio series.

My Rising Star portfolio is designed to represent both financial and social dividends. Given that purpose, companies that help conserve precious resources and keep the lights on more efficiently are perfect buy ideas.

This month, I'm buying EnerNOC (Nasdaq: ENOC), a stock that may be a new Foolish favorite. Both our Motley Fool Rule Breakers and Motley Fool Hidden Gems services have singled it out, and last week, fellow Fool Dan Dzombak recently purchased shares for his Rising Star portfolio.

For my portfolio's purpose, EnerNOC's biggest strength is its power to make our world a little greener by incentivizing energy savings. Still, despite this halo, purchasing EnerNOC includes very real risks.

The business
Boston, Mass.-based EnerNOC provides demand response and energy management services to grid operators and utilities, as well as commercial, institutional, and industrial power consumers. Its simple tagline: "Get more from energy."

According to the company, EnerNOC helps its customers "use energy more efficiently, pay less for it, and generate cash flow that benefits the bottom line." Basically, EnerNOC and its ilk help big energy consumers reduce their energy usage, then sell that savings back to utilities and grid operators.

Better managing energy supply and demand is a huge boon in our increasingly conservation-conscious country. The North American Reliability Corporation tells us that demand for electric power will increase by 19% in the U.S. in the next decade, but generation capacity is only expected to increase by 12%. A 2009 Federal Energy Regulatory Commission (FERC) report estimated that demand-response services like those EnerNOC offers could reduce peak energy use by 20% by 2019.

For a company that was only just incorporated in 2003, EnerNOC has racked up some high-profile associations. According to its most recent Form 10-K, end-use customers include AT&T, General Electric, Adobe Systems, and Pfizer, as well as the University of San Diego, Carnegie Mellon, several state governments, a handful of hospitals, and so forth. Its major grid operator and utility customers include PJM, ISO-NE, Southern California Edison, and the Tennessee Valley Authority.

Why I'm buying
EnerNOC shares fell about 20% between Feb. 4 and March 4. The pessimism has presented an opportunity to buy shares of this forward-looking company at a more reasonable price. (EnerNOC's shares surged last Friday; more on that situation later, since it relates to a key risk.)

Another plus is EnerNOC's strong balance sheet, with $153.4 million in cash and negligible debt. Groundbreaking companies often operate at losses, using lots of debt to start things rolling. EnerNOC isn't overly indebted, and 2010 marked its first profitable year.

EnerNOC has described a great market opportunity, and it's considered the market leader in this niche. In last year's annual report, EnerNOC said the North American market for reducing unnecessary electricity demand during critical peak hours between 2008 and 2030 (in lieu of building additional infrastructure) is $10.6 billion per year. The company also estimated that the market for eliminating the top 1% of peak demand worldwide could be $59.4 billion per year.

And now, the risks
As I mentioned before, EnerNOC shares got a major smackdown recently, and not without good reason. Major customer PJM Interconnection claimed that services such as EnerNOC were double-counting some energy reductions. A peek into EnerNOC's most recent 10-K emphasizes the danger: EnerNOC's open-market sales to PJM represented 60% of its total revenue in 2010.

Last Friday, FERC said that it wouldn't pursue any penalties, leading to a relieved rally in EnerNOC's shares. Still, investors shouldn't ignore the huge percentage of EnerNOC's revenue that PJM represents, and the latter's highly public grumbling about their business relationship. Companies with very few customers providing significant portions of their revenue are always more dangerous than companies with more diversified revenue sources. EnerNOC's Form 10-K lists this concentration as one of its principle risks.

Furthermore, even the newest industry players face competition. Major rival Comverge (Nasdaq: COMV) vies for the same customers that EnerNOC covets. In addition, energy companies of all stripes always face the possibility of regulatory changes that could hamper future growth.

My Foolish bottom line
EnerNOC is a relatively new business with exciting growth potential. In this day and age, wastefulness seems like a hallmark of a decadent and destructive past. EnerNOC is helping to pave the way toward a less wasteful future.

The company's recent uncertainty grants us an opportunity to get a cheaper price for this company's shares. Despite the very real danger, I'd consider EnerNOC's current concentration in so few customers a risk worth taking. The company's trying to fulfill a major need in the marketplace. If it success, it could enrich early investors while making the world a better, more efficient place to boot.

This article is part of our Rising Star Portfolios series, where we give some of our most promising stock analysts cold, hard cash to manage on the Fool's behalf. We'd like you to track our performance and benefit from these real-money, real-time free stock picks. See all of our Rising Star analysts (and their portfolios).

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.