3p Contributor: Nick Hodge
Recent Articles
Uncle Sam Singles Out Cleantech
We’ve known for a while now that the stimulus was going to be delivered with a heavy green hue.
Obama has talked for months–even during the campaign–about creating green jobs, promoting energy efficiency, and updating our embarrassing energy infrastructure.
So it’s no surprise that this massive piece of legislation, the first of his presidency, makes those and several other campaign promises a reality. But as with all federal stimuli, the taxpayer ultimately foots the bill.
Since you and hundreds of millions of other Americans are the loaners here, it’s probably prudent to see where billions of your borrowed dollars are going.
You can start by taking a peek at your new $37.5 billion energy bar tab.
Cap and Trade Legislation: Will California’s AB32 Go National?
Flash back to late September, 2006.
In California, the Governator has just signed Assembly Bill 32 (AB32), a Kyoto-style policy aimed at reducing greenhouse gas (GHG) emissions to 1990 levels by 2020, followed by an 80% reduction below 1990 levels by 2050.
The bill is met with little national fanfare and its implications, if they’re even understood, are largely dismissed as trivial.
Flash forward to present day.
An Inconvenient Truth has won an Oscar. The Intergovernmental Panel on Climate Change (IPCC) has issued a series of reports, authored by thousands of scientists, on the anthropogenic causes of climate change. Carbon trading is a $100 billion global market. And new-President Obama is intent on capping U.S. emissions in his first two years.
California’s AB32 is now in the national spotlight as a possible model for a national system, and there are mounting concerns about what, exactly, a price on carbon implies.
Solar Stocks: Wall Street Heavyweight or Punching Bag?
These are the top five names in solar: First Solar, Renewable Energy Corp., Q-Cells, SunPower, Suntech.
This is their stock performance over the past year:
In the best case from those five scenarios, First Solar, the stock is down 26%; in the worst case, Suntech, the stock is down 83%.
Something just doesn’t seem right here. Over 5.2 gigawatts (GW) of new solar capacity were installed last year–a record that crushes the 2.2 GW installed in 2007. But despite the 136% year-over-year capacity growth, shaky policy and deteriorating finance conditions have given investors cold feet, driving down stock prices as you can clearly see.
So what’s going on here? Has Wall Street rightfully rowed its solar boat ashore, or has their short-sightedness left solar shares ripe for the picking?
How Is Willy Wonka Like Obama? “Strike that, Reverse it”
"We have so much time, and so little to do! Strike that, reverse it."
That’s just one of Wonka’s many famous quotes in the classic 1971 film. And, if you think about it, the aphorism applies whether discussing chocolate factory tours or White House agendas.
Indeed, Barack Obama has much to do, and even less time to do it in. New policies need to be enacted that counter our current economic problems.
But before he can get to that, Mr. Obama is striking and reversing some unsavory remnants of the Bush administration’s climate policy–or lack thereof.
Whether it’s undoing what’s been done or paving a new way forward, there seems to a green tinge on most of what’s gone on in Washington since last Tuesday.
Pay careful attention, and you can see the seeds of a new energy and climate future being sewn.
The Obama Bounce: Wall Street Digs Cleantech
Wall Street’s earnings season is once again upon us.
Investors are paying particularly close attention this quarter in reaction to continued economic uncertainty and economic hardship. The smart money knows that this season isn’t bearing any gifts; most companies’ sales have taken recession-sized hits, and that will be reflected in the bottom line.
Concerning the cleantech stocks I watch, Johnson Controls (NYSE: JCI) was the first to spill the beans. The recent downturn left the company with a $608 million quarterly loss. For perspective, they made $235 million in the previous quarter.
Auto parts sales, as expected, were down a dramatic 32%. But more surprisingly, even the company’s Power Solution segment took a 32% sales hit.
The only bright spot? A nominal 4.8% drop in building efficiency sales.
Despite the horrendous financial performance, though, the stock was hardly affected.
And that’s the big story here.
EWG to IEA: Get it Right or We All Pay the Price
The Energy Watch Group just released a new report about wind energy, dubbed “Wind Power in Context – A Clean Revolution in the Energy Sector.”
In it, the EWG authors made no bones about calling out other agencies whose forecasts have been off the mark. The “worst forecasts,” they say, “regularly came and still do come from the International Energy Agency (IEA).”
I imagine those are fightin’ words in the energy modeling world. A proverbial back stab among prognosticating constituents. And yet, you can’t help but agree with the EWG. The IEA, as you’ll see, in which investors may put a bit too much confidence, has been wrong on many energy issues.
In this battle of the energy acronyms, it doesn’t look like the IEA has a chance. And if we keep planning our energy decisions around misinformation, we’re bound to run into serious and damaging consequences.
EPA’s Love Affair with Carbon About to End
The Environmental Protection Agency is, yet again, not doing the very thing its name implies.
For the umpteenth time in the past few years, the EPA is simply turning its nose up to carbon emissions, as if it shouldn’t and couldn’t regulate them. And that’s bologna.
It started early in 2005, when California asked the EPA if it could more stringently regulate emissions from its millions of automobiles. By 2007, the EPA still hadn’t answered the question, and California sued the EPA in April of that year.
Of course, all this came after most of the civilized world was already three years into the Kyoto Protocol, by which over 150 countries signed-up to voluntarily reduce their emissions by millions of tons.
We better get our act together. Our hubris in failing to regulate emissions on a national level could quickly turn out to be a multi-billion mistake, with expensive ecologic and economic consequences.
In the Smart Grid We Trust
In order to increase its renewable target to 33% by 2020, California needs an additional $6.5 billion worth of transmission projects. That’s according to the California Independent System Operator, which plays babysitter to the state’s electrical grid.
Current law requires 20% of the state’s power to be produced renewably by 2010, a goal that can be achieved without major infrastructure upgrades. But anything beyond that would require new transmission capacity, and new investment.
Similar scenarios are being played out around the country and the world, where intentions are good but technology is lagging. A 100% renewable energy mandate, for example, is nothing but laughable if the proper supporting cast isn’t in place.
And so we’re realizing, slowly but surely, that a shiny new solar plant in the middle of a desert is worthless unless it’s hooked up to a little thing we call the grid. As it happens, we’re discovering the grid is also in need of some drastic improvements.
Cleantech: The Recession-Proof Sector
Has the ongoing recession dampened your spirits?
It probably has, as it’s affected everything from stalwart automakers to commodity prices to home sales to unemployment. But despite a few delayed and canceled downstream projects (steel in the ground) due to limited credit, the cleantech sector has been largely unaffected when it comes to funding in the earlier rounds.
A recent survey by the National Venture Capital Association (NVCA) revealed that 400 venture capitalists expect investment at the venture level to wane in every sector but cleantech.
Sounds like we have a bull here.
Oil Executives: Oil Out, Renewables In
Big oil has once again gone into the confessional – and while oil industry execs have hinted at diminishing available supplies in the past, when prices were high, their recent admission that we’re running out of cheap oil is surprising now that prices have slid back down to three year lows.
This recent juicy piece of news (we’ll get more into it in a bit), coupled with Obama’s nomination of several energy-savvy cabinet members and the recent World Energy Outlook released by the International Energy Agency indicates that renewable energy is about to come on the scene in a big way.
With nearly all sectors of the market battered in the aftermath of a housing crash and resultant credit crisis, the coming onslaught of favorable policy conditions for alternative energy will allow investors to reap nice profits for several years.
Exciting as that may be, the reasons behind the unavoidable ascent of renewable energy–many of which are making headlines right now–are equally provocative.
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