Alternative Energy Stocks

Tom Konrad, Ph.D., CFA So far, the broad stock market seems to like the idea of a tax and regulation-cutting and infrastructure spending Trump administration and Republican controlled Congress.  The bond market is less pleased at the rapidly growing deficits such a "borrow and spend" policy will inevitably entail.  While the S&P 500 advanced 3.4% in November, bond funds fell in the face of rising interest rates.  The iShares 20+ Year Treasury Bond (TLT) fell 8.4%. Clean energy stocks were also hurt by the incoming President's climate change skepticism and his promises to undo environmental regulations put...

Jim Lane This week, in Washington and Brussels, four news flashes on global renewable fuel volumes appeared on the radar. Can you safely ignore them and get on with other work, or is there something to get deeply informed about? Let’s look into it. Ignore This #1. The Point of Obligation RFS Crisis. The issue. Several parties petitioned the US EPA to shift obligations under the Renewable Fuel Standard from them to someone else. Basically, to anyone else. The petitioners want relief from buying RINs, thinking about renewables, or experiencing any pain associated with the change...

by Debra Fiakas CFA The November 8th post “Trident Winds Floats a Plan for Morro Bay” described plans for one of the first wind energy projects off the western shores of the U.S.   Trident has perfected new technologies for a floating platform that makes possible the location of wind turbines in areas where ocean depths prohibit conventional wind turbines towers anchored to the sea floor.  Investors interested in wind energy technology do not have to wait for Trident to prove out to get a stake in ‘floating offshore’ wind energy.  Based in Europe, SBM Offshore (SBMO: ...

Tom Konrad, Ph.D., CFA Seaspan Worldwide has several classes of publicly traded securities, with different claims on its income streams. The company owns container ships leased under long term contracts to shipping companies.  The shipping industry is in a massive downturn, raising concerns about its customers' ability to pay. The company's preferred shares have sold off more than half as far as its common stock- far more than justified by its relatively low risk. There exists a 5.5% yield opportunity to buy the preferred and hedge the risk by buying puts on the...

The Inside True Story of a Company Gone Wrong, Part 5 by Jim Lane In 2011, KiOR raised $150 million in its June IPO, claiming that it was generating yields of 67 gallons per ton in its Demo unit operations. But it was miles short of that. In our previous installments, we have charted how KiOR moved from a promising early-stage technology to a public company with serious technological flaws that could have been fixed, but were ignored in what a senior team member speaking for the record, Dennis Stamires, characterized as a “reckless rush to commercial”. By 2012, numerous KiOR staffers of...

Jim Lane In Washington, the US Environmental Protection Agency released the 2017 renewable fuel volume obligations (and the 2018 volume obligations for biomass-based diesel), with a strong push beyond what has been termed the “blend wall” and stimulating refiners to implement more “cost-effective changes at their refineries to blend more renewable fuel.” The agency finalized a total renewable fuel volume of 19.28 billion gallons, of which 4.28 BG is advanced biofuel and 311 million gallons is cellulosic biofuel. Thus, the implied RVO for conventional biofuels like corn ethanol will be 15BGup from the 14.8 BG proposed in May. “Renewable...

by John Fullerton Imagine if you can, Donald Trump has arrived as a gift, to illuminate for us the American “shadow” at this pivotal moment in history. The Swiss Psychiatrist C.G. Jung refers to “the shadow” as the dark side of one’s self. The shadow, Jung wrote in 1963, “is that hidden, repressed, for the most part inferior and guilt-laden” aspect of our personality hiding out in the unconscious. Failure to recognize our shadow leaves us exposed to the destructive possession by our disowned shadow. Are we prepared to see the message of the shadow, illuminating our ongoing...

See my response here: https://www.greentechmedia.com/articles/read/how-one-clean-energy-investor-is-reacting-to-a-trump-victory Tom Konrad

by Paula Mints   The US election will have an affect on the US climate policy potentially swaying it much more towards conventional energy including fracking for natural gas and oil and away from deployment of renewables and incentives towards this end. The Clean Power Plan as established is unlikely to survive and states will start pulling back plans – not all states, but many of them. The Three Branches of Government: The Republican Party now controls the Executive, Judicial and Legislativebranches of government this means that the agenda followed by the country for at least two...

Jim Lane In Washington, Donald Trump captured the US Presidency in an upset victory that confounded pollsters and political pundits even as it delighted supporters of his maverick candidacy based on themes of immigration and trade reform coupled with a message that government policies of the past generation had failed for too many Americans. An unexpected series of wins across US Midwestern states – capturing Iowa, Pennsylvania, Wisconsin and Ohio which had gone for Obama in 2012 – provided a comfortable margin of victory in the Electoral College and the popular vote. 5 Themes Some immediate themes emerge...

by Debra Fiakas CFA US Geothermal (HTM:  NYSE) has been on our radar for some time.  Despite considerable accomplishment in terms of building electricity output from a portfolio of geothermal power installations, investors seem reluctant to embrace the company and its stock.  Earlier this week, US Geothermal management issued its usual quarterly update on its development work, this time detailing progress in expanding capacity and improving well performance on three of its geothermal installations.  Altogether an incremental 90 megawatts are under development, which would triple the current power generation capacity of 45 megawatts.  The company press release was met by...

Tom Konrad, Ph.D., CFA This October saw falling leaves and falling stocks. Then came the first week of November with its election jitters and stripped the trees of the rest of their leaves like a fifty mile an hour wind sending stocks flying as well. While Donald Trump's unpredictable performance has the whole stock market rattled (at least when it looks like he might win), his anti-environment and pro fossil fuel rhetoric have had stocks in the sector quaking like the leaves on an aspen. Although all its benchmarks were decidedly in the red for October...

by Paula Mints   Few people understand the time, money and effort required to develop and manufacture high quality solar technologies.  We can blame this fact on a reliance on press releases for news about the solar industry. Manufacturers drive these misunderstanding by not properly explaining that champion results are not analogous to or in many cases near commercial viability. The PERC, passivated emitter rear contact solar cell, now gaining market traction began its long trudge to commercial competitiveness in the mid-1980s. When manufacturers announce results without fully ex-plaining these results the effect is misleading and also...

by Paula Mints   Philosopher, essayist, poet and novelist George Santayana said: Those who cannot re-member the past are condemned to repeat it. The solar industry is expert at repeating its behavior and justifying the often devastating results by referring to them as the solar rollercoaster or, the solar coaster. To be clear, the industry’s behavior is closer to a Shakespearean tragedy than it is to a carnival or theme park ride. People choose to ride rollercoasters because once the ride begins they lose control for a brief period. They can enjoy the feeling of being safely...

by Paula Mints   The endless and endlessly not amusing US presidential election is thankfully wrapping up in November and there is a lot at stake for solar – globally. This is because the market for solar components and systems is global. Even the smallest installer buys imports. Even the smallest component manufacturer has the potential to ship product into any global market. A hiccup in one market (China, for example) reverberates throughout the entire global market for solar components and systems. A hiccup in the US market for solar deployment would affect business plans and forecasts...

by Debra Fiakas CFA The recent pullback in stock prices in the U.S. equity market has opened the door to some interesting dividend yields.  Investors with a taste for environmentally-friendly businesses have some particularly interesting alternatives that can pump up the purse as well as protect Mother Earth. AES Corporation (AES:  NYSE) is a world-class power generator from mixed portfolio of conventional and renewable power sources.  About 28% of its 29,352 megawatts of generation capacity is from renewable fuel sources, including hydro, biomass, solar and wind, and another 33% from plants using natural gas.  The balance of...