Alternative Energy Stocks

by Debra Fiakas CFA Cars powered by fuel cells or batteries are only as clean as the electricity used to produce the power source.  Proponents of hydrogen fuel cells argue that fuel cells have an edge over batteries, because hydrogen can ultimately be made cleaner with innovations in hydrogen production.  Steam reforming of natural gas is the most common source of hydrogen and for the most part it is still the most cost-effective process for large-scale production of hydrogen.  Since ethanol is a renewable resource, the steam reforming of ethanol has been proposed by some as...

By Jeff Siegel I learned today that sales of Honda's natural gas Civic tanked 65% in 2014. I didn't even know they were still trying to sell those things! I actually remember a few years ago, attending a car show and talking to a Honda rep who was pushing this thing. I didn't have the heart to tell him he was barking up the wrong tree when he tried to sell me on all the benefits. What benefits? Inferior fuel economy, a clunky ride, and no infrastructure? Sure, there was the special fueling unit that could be installed in...

By Jeff Siegel This past Saturday afternoon, Rick Diaz locked in another customer. A former roofing contractor, Rick is now a sales rep and installation manager for a small roofing and solar company in Maryland. He tells me most people he talks to about solar have pretty much already made up their minds before he even walks in the door: The investment works out for young couples who are going to be in these homes for more than ten years. But most seem more concerned about the environment than the return on investment. Either way, it's a...

By Harris Roen Not all alternative energy mutual funds are created equal. In a recent interview with the Wall Street Journal, a reporter asked me which alternative energy mutual funds were the most focused on renewables, noting that many mutual funds hold non-energy related companies such as Apple, PepsiCo and Google. The answer to this question is not as straight forward as one might think. This article sorts out which mutual funds are truly invested in the dynamic and growing green energy sector, and which ones are more peripheral.   Greener Than Thou–Revealing How Much...

by Debra Fiakas CFA Near the close of 2014, Nuvera Fuel Cells was acquired by NACCO, an operating company of Hyster-Yale Materials Handling, Inc. (HY:  NYSE).  Nuvera sells a proprietary fuel cell stack under the brand name Orion for industrial mobility, automotive and aerospace applications.  The company also sells its PowerTap Hydrogen Station for on-site hydrogen generation (see image below).  The purchase price was not disclosed and Hyster-Yale has not provided guidance on how the deal will impact its sales and earnings in 2015.  Apparently, Nuvera’s sales and earnings are not material to Hyster-Yale in the...

by Debra Fiakas CFA Last week Toyota Motor Corporation (TM:  NYSE) announced its intention to share its patented fuel cell technology with other automotive manufacturers.    Engineers from competing auto manufacturers can get a look at Toyota’s fuel cell designs up through 2020.  Toyota has taken a page from Tesla Motors (TSLA:  Nasdaq), which made its electric vehicle battery designs available to the public last year.  Since the car business is intensely competitive, automotive manufacturers are typically quite circumspect about their innovations.  However, producers of cars powered by alternative energy sources are faced with a unique problem ...

by Tess Olsen-Rong Following a landmark green bond growth year in 2013, the labelled green bond market has once again experienced a year of incredible growth in 2014: by year-end there had been $36.6bn of green bonds issued by 73 different issuers – that’s more than a tripling of the market! The final figure was boosted by a late flurry of green municipal bonds. This exponential growth takes the total amount of green bonds outstanding to $53.2bn by the end of 2014. So, what happened to cause this tripling of issuance? Well, corporate and municipal bond...

by Tess Olsen-Rong Green municipal bonds are set to take off in 2015 after a flurry of issuances in the latter half of 2014. With interest rates at an all time low, this is the time to finance the vast backlog of infrastructure upgrades and developments needed – and to green that infrastructure. This, according to the Financial Times, is especially so in the US. With green muni growth has come a growing diversity in the use of proceeds. Some green municipal bonds are using proceeds for projects where the green credentials are more complex to analyse...

by Debra Fiakas CFA The New Year got off to a rocky start for Ballard Power Systems (BLDP:  Nasdaq), a developer of fuel cell technologies and systems.  The company ran into some trouble with its strategy to penetrate the China market through a partner.  No one should be surprised by Ballard’s difficulties.  Fuel cell technology has been under development for more than two decades.  Frankly, technology is not the problem  -  at least any more.  Early on developers were beset by numerous challenges, not the least of which was the problem of getting fuel cells to work properly...

By Tim Conneally The pool of public solar yieldcos keeps growing. Just before the Christmas holiday, Sol-Wind Renewable Power LP filed for a $100 million initial public offering with the Securities and Exchange Commission. This will be the eighth Yieldco to debut since 2013, and the stock will trade on the NYSE under the symbol SLWD. But there's something different about this one. Sol-Wind is a yieldco that utilizes a Master Limited Partnership (MLP) structure, so it will be taxed differently from the other Yieldcos. Generally speaking, a Yieldco is similar to MLPs by nature, but the taxation...

Jim Lane A quick overview of BioAmber (BIOA) Company description From the company’s 2013 S-1: “Our proprietary technology platform combines industrial biotechnology, an innovative purification process and chemical catalysis to convert renewable feedstocks into chemicals that are cost-competitive replacements for petroleum-derived chemicals. The development of our current organism was originally funded by the DOE in the late 1990s, was further developed and scaled up, and optimized at the large-scale manufacturing facility in France. “We manufacture our bio-succinic acid in a facility using a commercial scale 350,000 liter fermenter in Pomacle, France…We have produced 487,000 pounds, or 221 metric...

by Debra Fiakas CFA Before the open of the first trading day of 2015, fuel cell developer Ballard Power Systems (BLDP:  Nasdaq) announced the termination of technology licenses to Azure Hydrogen, which was to have been Ballard’s introduction to the China market. The license agreements covered the sale of Ballard’s bus power module and telecom backup power system.  Ballard has charged Azure with breaching the agreements and the two companies have apparently not been able to come to alternative terms.  Azure had made sales in the China and not all of the equipment had been paid. ...

By Harris Roen Mutual Funds (MFs) Falling fossil fuel prices have hampered 2014 returns for alternative energy mutual funds. Returns are slightly down on average for the past three-month, with a third of funds showing losses. Monthly gains fared worse, with only 2 out of 14 funds in the black. One-year returns are flat on average, and range from a high of 8.3% for Gabelli SRI Green AAA (SRIGX), to a low of -14.3% for Guinness Atkinson Alternative Energy (GAAEX)…   Exchange Traded Funds (ETFs) Alternative energy ETFs had a wide range of returns for 2014,...

Tom Konrad CFA The last two months have not been kind to clean energy stocks.  Most commentators attribute the weakness to declining oil prices and the Republicans' strong showing in the midterm elections.  Whatever the cause, my 10 Clean Energy Stocks for 2014 model portfolio was dragged into a loss for the year where it had previously looked to return a small gain.  A large part of the decline was in the dollar's strength.  Measured in local currency, the average stock was flat, but the 8% decline in...

Bottom line: Traditional car makers will suffer from weak sales growth and plunging margins in China in 2015 and into 2016, while EV makers will start the new year slow but could see improvement by the end of 2015. A flurry of headlines this week are sending ominous signals for the car industry in the year ahead, with both traditional and new energy vehicle makers likely to face an uphill road as China’s economy slows. The problem could be compounded as big new capacity comes online from many major automakers that have invested billions of dollars on expansion over...

Tom Konrad CFA 2015 marks my seventh annual list of ten clean energy stocks.  An equal weighted portfolio of the ten stocks in each year's list has outperformed my industry benchmark every year except 2013.  2014 was no exception, but it was a bittersweet victory in that the model portfolio was slightly down while the benchmark lost considerably more in a very challenging year for clean energy stocks. I will publish a wrap-up article for the 2014 list in the next couple days, but I wanted to get the 2015 list out on New Year's day.  ...