Monthly Archives: October 2009

Geothermal Companies Receive Cost Sharing Grants from DOE

Tom Konrad CFA My entire portfolio of Geothermal companies received DOE cost-sharing grants Friday.  Here's a quick run-down: Nevada Geothermal (NGLPF.PK, NGP.V) received $1.7M for its Crump Geyser project, and $1.6M for its Black Warrior project. NGP also celebrated completion of  its Blue Mountain Faulkner 1 plant the same day. US Geothermal (HTM) received $3.77M for it San Emidio project. Sierra Geothermal (SRAGF.PK, SRA.V) received $10M for exploration at its Alum and Silver Peak projects.  Ormat (ORA) received two grants, and is likely to benefit from other grants since geothermal exploration companies such as US Geothermal contract with...

Why Do Green Energy Experts Buy Solar Stocks? 

Tom Konrad CFA Green energy experts accept that solar panels are one of the least cost effective ways to reduce your carbon footprint.  Nevertheless, many buy solar stocks.  They should rethink their investment strategies. I recently spoke on "Stock Selection in the Era of Peak Oil and Climate Change" at the ASPO 2009 International Peak Oil Conference.  Whenever green energy enthusiasts find out that I analyze green energy stocks professionally, they react in one of two ways.  Many want to know my top stock pick in general (New Flyer Industries NFI-UN.TO/NFYIF.PK) or in their favorite sector (see below.)   ...

Dyadic International (DYAI.PK): Update

Tom Konrad, CFA Representatives of Dyadic International (DYAI.OB) were quite upset when I called the company "A Stock to Avoid."  The company has now released audited financial statements for 2007 and 2008.  The lack of such statements was one of the several reasons I said to avoid the company.  Should I retract my article? Mark Emalfarb, Dyadic International's CEO sent me an email this morning with attached audited financial statements for 2007 and 2008, saying, I hope that you will act responsibly as journalists and publish a retraction to your article "A Stock To Avoid" which Tom...

Shale Gas: Promises, Promises, Promises

Tom Konrad CFA Dr. Arthur Berman, of Labyrinth Consulting Services has taken a hard look at actual production data from  Barnett Shale in 2007.  What he found should worry anyone expecting this abundant, relatively clean, domestic energy resource to be cheap.  It should especially worry investors in shale gas companies, such as CHK, DVN, and XTO. In a panel entitled "Natural Gas Game Changers?" at the 2009 International Peak Oil Conference, Dr. Breman presented some results from his research into the actual production from the nearly 2000 horizontal gas wells drilled in the Barnett Shale in 2007.  The Oil...

A123 Systems vs. BYD and Other Irrational Battery Investments

John Petersen Mother always taught me that if you can't say something nice, it's usually better to say nothing. While regular readers might question my ability to follow Mom's advice, this is an article I had really hoped somebody else would write. The quick summary is that while the shares of A123 Systems (AONE) may be a reasonable investment at current prices, the shares of BYD Co. Ltd. (BYDDF.PK) are an irrational value proposition, the shares of Ener1 (HEV) are even worse, and the shares of Valence Technologies (VLNC) are beyond understanding. Since many readers find detailed tables...

Asking the Right Questions: Why Invest in Clean Energy?

Tom Konrad, Ph.D., CFA Often, knowing more about a company is less useful than knowing just a few of the right things.  Knowing the right questions to ask can help investors wade through a sea of mostly irrelevant information. Take a moment to answer the following poll: Suppose you want to know if fictional solar Company MySolar will outperform other solar stocks. Which fact would be most useful in your decision?(poll) The key to this question was the stated goal of "outperforming other solar stocks."  An investor who is only hoping to achieve returns equal...

What Shouldn’t Be in a Green Energy Portfolio

The London Accord took a look at what portfolio theory would suggest as the most effective ways to address Climate Change.  Knowing which technologies don't make the cut is at least as useful as knowing which technologies do. Tom Konrad, Ph.D., CFA I recently looked at a paper from the London Accord which used portfolio theory to recommend the best mixes of technologies to deliver different levels of carbon abatement.  The most useful technologies to achieve the needed levels of carbon abatement were Forestry, Hydropower, Biofuels, Wind, Efficiency, and Geothermal. I suggested stocks that investors might consider to invest in...

What A Portfolio Approach To Climate Policy Means for Your Stock Portfolio

Portfolio theory can lend insights into which carbon abatement strategies policymakers should pursue.  If policymakers listen, what will it mean for green investors? Tom Konrad, Ph.D., CFA Good Info, Not Enough Analysis I've now read most of my review copy of Investment Opportunities for a Low Carbon World.  The quality of the information is generally excellent, as Charles has described in his reviews of the Wind and Solar and Efficiency and Geothermal chapters.  As a resource on the state of Cleantech industries, it's generally excellent.  As an investing resource, however, it leaves something to be desired.  Each chapter is written...

Hydrogen Fuel Is Not Dead

John Lounsbury With the furor over the potential for hybrid, plug-in hybrid and all-electric cars recently, one might think the hydrogen car was dead. Nothing could be further from the truth. Feasibility at an affordable price appears to be established and market availability of hydrogen powered cars may come sooner than you think. Many issues remain to be addressed and this article will try to cover them. The problems to be overcome are not insurmountable, but are also not trivial. These problems include the economics of hydrogen production, transportation, distribution and...

EESAT And Energy Storage Opportunities On The Smart Grid

John Petersen Last week I appeared as a luncheon speaker at EESAT 2009, a biennial international technical conference sponsored by the DOE, Sandia National Laboratories and the Electricity Storage Association that focuses on storage technologies for utility applications. The conference included dozens of high-level technical presentations from storage technology developers and was far and away the best-organized event I've ever attended. The only notable absence was a large contingent of buyers, which left some participants wondering whether they were preaching to the choir. Nevertheless, I was encouraged by rapid growth in the number and size of utility-scale demonstration...

Oil & Alt Energy Redux

Charles Morand Last week, I conducted an analysis showing the lack of evidence supporting claims that oil and alt energy returns are strongly correlated (claims that sometimes come from outfits as reputable as Bank of America Merrill Lynch).     I don't want to belabor this topic but I thought I would post the results of another, similar analysis I conducted following comments I received on how to improve the first one. In a nutshell, the comments suggested I do the following: 1) Look at daily correlations or even smaller periods, as "common knowledge" market...

Green Energy ETFs Compared

UPDATE 3/4/2011: An up-to date article on selecting green mutual funds and ETFs can be found here. Green energy Exchange Traded Funds (ETFs) are the simplest way to invest in the sector at reasonable expense.  Here is what you need to know to choose. Tom Konrad, Ph.D., CFA Why ETFs? Investors interested in a simple way to invest in a diverse basket of renewable energy and energy efficiency companies should consider Exchange Traded Funds (a.k.a. ETFs) first.  Although green energy mutual funds will be more familiar to many investors, they come with costs that are difficult to justify...

Green Energy Mutual Funds Compared

UPDATE 3/4/2011: An up-to-date article on selecting green mutual funds and ETFs can be found here. Tom Konrad, Ph.D., CFA Most investors looking to get into clean energy think first of mutual funds.  Here are the options, and how to choose. We track seven mutual funds with a focus on green energy and climate change at AltEnergyStocks.com, since the American Trust Alternatives Fund closed early this year.  I split them into two categories: the funds with a primary focus on clean energy, and those with a primary focus on the environment.   The clean energy funds are: the Firsthand...

Q3 Performance Update: Ten Green Energy Gambles for 2009

Tom Konrad, CFA I never thought 2009 would be a good year for risky stocks, but my readers asked for them anyway.  The market's strong third quarter have paid off for risk-takers who gambled on my 10 Green Energy Gambles for 2009. I started out the year by providing readers with a portfolio of ten relatively conservative plays on green energy.  That portfolio was representative of how I planned to approach the market this year, and has produced stronger returns and less volatility when compared to both green energy stocks and the market as a whole.  Many of my...

Crude Oil & Alt Energy: The Non-Relationship That Just Won’t Go Away

Charles Morand The relationship - or lack thereof - between oil prices and the performance of alt energy stocks has been a long-time interest of mine. I discussed it last in late March when I looked at correlations between the daily returns of alt energy and fossil energy ETFs. At the time, I found that only a weak relationship existed between the two and that if someone wanted to make a thematic investment play on Peak Oil, alt energy ETFs were not an ideal way to do so.  Seeing as the popular press and countless "experts"...

Battery Investing for Beginners: Index

John Petersen wrote a series of popular articles last week to introduce new investors to the battery sector, following the A123 IPO.  We've had a couple requests from readers who missed one part or another, so here is a quick index to the articles. Part I - Battery industry overview. Parrt II - Comparison of energy storage technologies and companies. Part III - Benchmarking Performance of battery stocks Part IV - Debunking misconceptions about electric vehicles and battery technology.