Monthly Archives: June 2014

The Safest Alternative Energy Yieldco

By Jeff Siegel If you're a regular reader of these pages, you know I'm bullish on alternative energy yieldcos. In fact, I've covered Pattern Energy Group (NASDAQ:PEGI) and NRG Yield (NYSE:NYLD) at length. The way I see it, yieldcos are the next big alternative energy investments for retail investors. They enable regular investors to buy into multiple alternative energy assets that produce steady cash flow. For those not particularly keen on risk, but still want exposure to the burgeoning alternative energy space, this is a great way to do it. The bottom line is that...

Is Clean Water Always Green? Why I <3 NY

By Bridget Boulle and Sean Kidney Helping to push along the green muni space, the New York State Environmental Facilities Corp (EFC), rated AAA, has issued a USD 213 million green / water bond. There were 30 bookrunners on this bond with JP Morgan and LOOP Capital Partners co-leads - see prospectus. The proceeds will be used to provide financial assistance to local governments to finance and refinance drinking water projects as well as to refund certain bonds previously issued. They expect to support 128 drinking water and wastewater infrastructure projects across the State. Qualifying projects...

Vornado Realty Green Bond Boosts US Market, But Lacks Ambition

By Bridget Boulle and Rozalia Walencik Last week BBB-rated Vornado Realty (NYSE:VNO) became the second US real estate investment trust to issue a corporate green bond, following the Regency Centres (NYSE:REG) bond late last month. The 5 year, $450 million bond was structured by Bank of America Merrill Lynch. Pricing was in line with non-green bonds. Investors included asset managers, pension funds, insurance companies and governments, of which some were regular investors and others had a specific green interest. Some non-US investors also came in. According to the prospectus, the proceeds will be used to fund buildings and retrofits...

Utility Expects Growth From Green Consulting

by Debra Fiakas CFA Middlesex Water Company (MSEX: Nasdaq) has been providing the good people of New Jersey and Delaware with water services for a long time.  Its longevity in the marketplace is probably one of the reasons, Middlesex can claim a string of successive revenue and earnings increases.  The company achieved a net profit of $16.4 million on $115 million in total sales in the most recently reported twelve months.  More importantly, Middlesex turned 27.7% of those sales into operating cash flow, an achievement that helps support the company’s investment plans and dividend. Like any other water...

SolarCity Buys Silevo for $200 Million, Plans GW Factory in NY

Meg Cichon Silevo's Triex Solar Technology In an effort to further streamline its solar business and lower the overall cost of solar energy, SolarCity (SCTY) announced today that it would acquire high-efficiency cell manufacturer Silevo for $200 million. In an effort to scale up the technology, SolarCity plans to construct a 1-GW manufacturing facility located in Buffalo, New York within the next two years. The solar leasing company acquired mounting company Zep Solar in late 2013 in an effort to further vertically integrate its business. Now, chairman Elon...

SolarCity Soars On Silevo Aquisition

Silevo's Triex Solar Technology By Jeff Siegel DISCLOSURE: Long SCTY. SolarCity Corp. (NASDAQ: SCTY) has signed a deal to acquire Silevo, a solar panel technology and manufacturing company on June 16th. With Silevo now in the fold, SolarCity is in discussions with the state of New York to build a new manufacturing plant with a targeted capacity in excess of one gigawatt – within two years. Upon completion, this will be one of the largest solar panel production plants in the world. Although there are plenty...

The EPA’s Carbon Rule: Likely Stockmarket Winners

By Harris Roen Greenhouse gas emissions by economic sector   A seismic shift in the power generation landscape is starting to sink in. It has been two weeks since the EPA announced its new proposed carbon rules, one of the flagship efforts of the Obama Administration to address climate change. This shift is meant to move the country in the direction of inevitable changes coming to the energy economy. It is important for investors to know which companies and sectors stand to benefit from the...

Tall Neighbor Coming to Arizona Desert Community

by Debra Fiakas CFA The citizens of a San Luis, Arizona are about to get a new, very tall neighbor.  Solar Wind Energy, Inc. (SWET:  OTCQB; formerly Clean Wind Energy Tower) recently secured 600 acres in the area to build a solar wind tower.  This is a unique design that takes advantage of air heated by the sun’s power utilizes.  Fast cooling of the air creates a powerful downdraft that drives turbines at the chimney base.  Solar Wind expects the generators attached to its turbines to produce up to 1,250 megawatts of electricity that can be...

RGS Energy: Tempered, Opportunistic Growth

Garvin Jabusch Kam Mofid has a more long-term vision than most CEOs. His emphasis on the next earnings per share (EPS) report and his obsession with short-term focus are minimal relative to America's typical boss. He's not primarily managing to the next quarter. His company, RGS Energy (ticker symbol: RGSE), is a solar-module installer, mainly in the residential vertical. RGSE doesn't directly compete with most solar panel manufacturers. Instead, it provides residential rooftop installation distribution for them. It then captures lease payments and revenues from selling excess electrical generation to the grid (in states that allow it). Whereas First...

Force in Name Only

by Debra Fiakas CFA One of the companies in our novel alternative energy indices is Forcefield Energy, Inc.  (FNRG:  Nasdaq).  For a time it was listed as among alternative chemical products and now is included among waste-to-energy developers, but it could be as easily included in our data base among sellers of LED lighting products.  The identify confusion is due in part to Forcefield’s own description, which includes a laundry list of capabilities and technologies. The company lays claim to proprietary products for heat recovery and the conversion of waste heat to useful purpose.  Forcefield comes by...

Ming Yang To Build 300 GW Chinese Wind Farm

Doug Young Wind power company Ming Yang (NYSE: MY) became China’s latest new energy equipment maker to dip its toe into project finance and development last week, when it announced a new plan for a massive wind farm project in Jiangsu province. Its announcement follows similar moves by many of its peers from the solar sector, and comes as Beijing embarks on a broader plan to clean up China’s air through initiatives like clean energy development. Plans like Ming Yang’s will certainly help China to meet its ambitious goals; but they also carry a huge burden and...

Trina Joins Solar Fund Raising Queue

by Doug Young Just a day after the solar panel sector was hit by a new negative trade ruling from the US, Trina Solar (NYSE: TSL) gave its investors another unwanted surprise with word that it is preparing to raise more than $200 million through a combination of new stock and bond offerings. Trina joins a growing list of solar panel makers that are looking to western capital markets as confidence returns to the sector following a prolonged downturn dating back to early 2011. The fact that Trina and others are turning to western capital markets to...

US Geothermal: Egregiously Undervalued?

by Debra Fiakas CFA Last week US Geothermal (HTM:  AMEX), a power generator from geothermal projects in California, Oregon, Nevada and Idaho, made an appearance at the Marcum Microcap Conference in New York City.  The company stood out among most of the companies appearing in Marcum’s so-called ‘energy track’ as one of the few with solid revenue and profits.  US Geothermal reported a net profit of $1.9 million on $28.8 million in total sales in the twelve months ending March 2014.  The net profit is commendable, but what I find more interesting is the conversion of 30%...

Mantra’s Promise of Innovation

by Debra Fiakas CFA How often do we see the crowd rooting for the underdog?  You could hear the cheers for Mantra Energy (MVTG:  OTC) last week at the Marcum Microcap Conference in New York City.  Mantra is a developmental stage company pursuing technologies to harness carbon dioxide for energy.  Of course, the company has no revenue and therefore no earnings.  Indeed, its technologies are so unique and as yet at such an early stage some might find them almost fanciful.   Yet for some investors, a fanciful underdog is even better than another.   Mantra sees itself...

Alternative Energy Mutual Funds and ETFs Returns Flatten

By Harris Roen Alternative Energy Mutual Fund Returns Alternative energy mutual funds have given back some of the gains they have enjoyed since the beginning of the year, though they are still up almost 20% on average. All MFs are in positive territory, with annual returns ranging from 9.8% to 40.9%. MFs are also up nicely for the week and month, but on average are down slightly in the past three months. These returns are very different than those of just five months ago, when alternative energy MFs were doing almost twice as well… ...

US Closes Solar Tariff Loophole

Doug Young In a move that should surprise no one, the US has announced it will levy new punitive tariffs on China-made solar panels to close a loophole from an earlier ruling. This move won’t help anyone and could seriously stifle the industry’s development just as it starts to emerge from a prolonged downturn. It also looks worrisome from a broader perspective for Chinese panel makers, since signs are emerging that their products could also be shunned in Japan and India, 2 of the world’s other promising emerging markets for solar power plant construction. I’ll return...