Monthly Archives: January 2015

Terraform Power Issues $800m High Yield Green Bond

by the Climate Bonds Team This week the yieldco TerraForm Power (TERP) issued a huge high-yield green bond; seeing more high-yield bonds is a sign that the green bond market is continuing to mature. In addition to TerraForm, more green bonds from repeat issuers OPIC, World Bank, IFC and Credit Agricole have been announced and will be closing in the coming weeks. For today, let’s dig deeper into the latest green high-yield offering. The US-based renewable energy company TerraForm Power Operating has issued US$800m of senior unsecured green bonds (debentures), making it the largest green bond of 2015...

Gevo Raises Money After Win At Supreme Court

Jim Lane Following just one day after a big win in the Supreme Court and a corporate update last week, Gevo (GEVO) announced that it intends to offer and sell, subject to market and other conditions, common stock units. Each common stock unit will consist of one share of common stock, Series A warrants to purchase a certain number of shares of common stock and Series B warrants to purchase a certain number of shares of common stock. The units are to be sold by Gevo subject to market and other conditions in an underwritten public offering. Update!...

Supreme Court Sides With Gevo In Patent Dispute

Jim Lane In Washington, the U.S. Supreme Court ruled in Gevo’s (NASD: GEVO) favor and overturned an earlier Federal Circuit Court of Appeals ruling on the interpretation of key patent claims. On April 11, 2013, the Delaware District Court (District Court) entered a final judgment of non-infringement in Gevo’s favor following the acknowledgment by Butamax Advanced Biofuels LLC (Butamax) that Gevo does not infringe Butamax’s asserted patents under the District Court’s construction of a key claim term in Butamax’s Patent Nos. 7,851,188 and 7,993,889. At the time, Butamax appealed Gevo’s victory, and a US Court of Appeals in...

Gevo: Isobutanol Lottery Ticket

by Debra Fiakas CFA The last time renewable chemicals developer Gevo (GEVO:  Nasdaq) was featured in this forum in August 2014, the stock was looking quite oversold around $0.50 per share. The stock had recently taken a tumble after management sold 30 million shares of the company’s common stock at $0.60 a share at the end of July 2014.  The plan was to use the $19 million in new capital to upgrade a production plant in Minnesota to better produce renewable isobutanol along with ethanol fuel.  Isobutanol is a popular solvent used widely in industrial applications. ...

Leveraging Finance and Charity To Make Affordable Housing Greener

by Tom Konrad CFA Many people still think of green technologies as costly. But cost is never the main barrier to efficiency measures, which often can boast internal financial returns far higher than even risky junk bonds.  The barriers against energy efficiency and legion, but cheif among them are the small size of the investments and split incentives, where the person making the investment is not the same person who reaps the rewards. A Colorado based NGO, the International Center for Appropriate and Sustainable Technology (ICAST), recently launched a charity-finance hybrid to overcome this problem of split incentives....

Making Hydrogen From Ethanol

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...

Honda Natural Gas Civic Sales Sputter

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...

Five Solar Stocks To Own In 2015

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...

How Green Is Your Mutual Fund?

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...

Hyster-Yale’s Fuel Cell Deal

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...

Toyota Opens The Fuel Cell Kimono

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 ...

$37B 2014 Green Bond Issuance Triples Market

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...

A Flurry Of Green Muni Bonds

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...

Fuel Cells: Know Your Market

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...

Sol-Wind: New Yieldco With A Tax Twist

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...

5 Minute Guide to BioAmber

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...