2010: The Year of the Strong Grid?: Index

Tom Konrad CFA A somewhat delayed index to my Year of the Strong Grid series, looking into electricty transmission and distribution (T&D) or "Strong Grid" companies. Part Subject / Description Stocks mentioned I Introduction: Why Electricity Transmission and Distribution is a good investment. None II Comparing the financial strength of eletricty T&D companies ABB AMSC CPTC.OB CVT.TO BGC JST MTZ MYRG PIKE PWR RSSYF.PK SI VMI WCC III EMCORE Group (EME) and AZZ Incorporated (AZZ) ...

Will Surging Smart Grid Investments Result in Surging Electric Prices?

John Petersen The electric power system in the U.S. is dirty, antiquated, stupid, unstable, and a security nightmare. After years of discussion and debate, consensus now holds that the generation, transmission and distribution infrastructure will need hundreds of billions in new investment to reduce emissions, improve reliability, minimize waste and inefficiency, improve security, and facilitate the integration of wind, solar and other emerging alternative energy technologies. Commonly cited capital spending estimates range from $200 billion globally by 2015 to $2 trillion overall. In his November 2008 report, "The Sixth Industrial Revolution: The Coming of Cleantech," Merrill Lynch strategist...

2010: The Year of the Strong Grid? Part VI: Will the Real Strong Grid...

Tom Konrad, CFA For clean electricity to flourish, the electric grid needs not only to be smarter, but more robust.  This is where my strong grid stocks come in.  But stringing wires for power is a lot like stringing wires for telecommunications as well a large number of other businesses which do not have much to do with the energy trends I hope will boost the long term prospect of these companies.  Knowing how much these companies earn from grid infrastructure helps predict how much they will benefit from the trend. Unlike many of the financial statistics...

2010: The Year of the Strong Grid? Part V: Hubbell Inc.

Tom Konrad, CFA Hubbell Inc. (HUB-B) is a strong grid stock that also has strong financials, signaled by a recent dividend increase. I came across Hubbell Inc. (HUB-B) when researching General Cable (BGC) for my recent article on the company.  Just one more example of when you start researching a sector, (in this case electrical transmission and distribution, or "strong grid") you never know what new companies you may find. Hubbell is a diversified electrical supplier, serving electric utility, residential, commercial, and industrial markets worldwide.  About a quarter (26%) of its revenue comes from the "Power...

2010: The Year of the Strong Grid? Part IV: General Cable

Tom Konrad, CFA General Cable (BGC) is a strong grid stock that's suddenly looking a lot cheaper.  Time to buy? General Cable is not only one of my Ten Clean Energy Stocks for 2010, it was also holding it's own in my list of "strong grid" (that is, electricity transmission) stocks that have strong financials.  About 59% of the company's revenues come from what I would consider "strong grid" markets: their "electrical utility" and "electrical transmission" segments.  I published the most recent version of that list on February 11.  In both these articles I cautioned that I...

2010: The Year of the Strong Grid? Part III

Two Strong Grid Stocks in Hiding Tom Konrad, CFA A look at two transmission (or "Strong Grid") stocks I missed previously: EMCORE Group and AZZ Incorporated. In part I of this series, I made the case that 2010 might be the year that transmission stocks caught investors' attention, as smart grid stocks did in 2009.  In part II, I looked at the transmission stocks in our Electric Grid stock list, and compared their financial strength.  My initial screen, based on Current ratio, Cash on Hand, Debt, Cash from Operations, P/E ratio, and dividend yeild allowed...

Smart Grid’s Expected 250% 5-Yr Growth Rate is Great News for Cisco, IBM, Accenture,...

Bill Paul Lux Research forecast last week that the global smart grid market will grow some 250% over the next five years, reaching nearly $16 billion by 2015 compared with today’s $4.5 billion. Interestingly, Lux further forecast that only a few select firms will take full advantage of this looming largesse. It’s understandable why the payoff won’t be widely shared. As regulated entities (on the transmission and distribution side), electric utilities have an obligation (specifically, the time-honored “obligation to serve”) that effectively requires that they be conservative when partnering with IT firms that can provide the money-saving,...

2010: The Year of the Strong Grid? Part II

The Strongest Strong Grid Stocks Tom Konrad, CFA A comparison of the financial strength of transmission (or "Strong Grid") companies. In Part I of this article I made the case that transmission stocks, or "Strong Grid" might be a clean energy sector that takes off in 2010, as Smart Grid stocks and Battery stocks did in 2009.  If the sector does take off, the rising tide will probably float all boats, but if it doesn't, it will probably be better to be in the strongest such companies, because, as in 2009, the harsh financial climate will probably mean that...

2010: The Year of the Strong Grid?

Part I: With Smart Grid Brains and Transmission Brawn... Tom Konrad, CFA A robust national grid will be essential to achieving high penetration for renewable electricity at reasonable cost, and the companies that can help build it are an essential part of a clean energy portfolio.   Many renewable energy advocates, especially those enchanted by the gigantic potential for solar, think that we can get by with local renewable energy.  While it's a pretty vision, the timing of wind and solar (the only forms of renewable energy that have the potential to produce 100% of our electricity) mean that this...

Playing the ‘Global Grid Game’ – Japan’s NGK, GE Majority-Owned Indo Tech Look Strong

Maintaining and expanding the world's electric power grids in order to avoid stupendous blackouts, add gigawatts of green power, and bring electricity to a billion additional people, will cost hundreds of billions of dollars over the next 10 years. Retrofitting just the U.S. power grid will cost $130 billion, estimates the Electric Power Research Institute (EPRI). China has earmarked $135 billion to upgrade and expand its high-voltage grid. India will need to spend billions if it has any hope of reaching its goal of increasing electrical generation capacity to 200 GW by 2012 from roughly 150 GW currently. Among...

New Transmission Technologies

Tom Konrad, CFA Why wasn't Aluminum Conductor Composite Core (ACCC) technology mentioned in Colorado's REDI report? In December, I gave readers a brief summary and a few investing ideas based on Colorado's Renewable Energy Development Infrastructure (REDI) report.  I've now read the entire report, much of which is focused on Colorado's needs in terms of electric infrastructure.  In addition to some useful price data for long distance transmission, there was a short section on "the potential for new transmission technologies" (page 35.)   The new technologies mentioned were  Aluminum-conductor, steel-supported (ACSS) with ultra-high strength cores. Aluminum-conductor, composite reinforced (ACCR)...

If I Could Own Only One Alternative Energy Stock, It Would Be . ....

Bill Paul My friend Consuelo Mack, host of "Consuelo Mack's Wealthtrack" on PBS TV, asks her guests for their "one investment pick." What's my one alternative energy stock pick? A year ago on Consuelo's show, I recommended LED lighting developer Cree Inc. (Symbol CREE), because the LED lighting market (part of the burgeoning energy efficiency sector) is expected to hit upwards of $5 billion by 2013 v. $600 million in 2008, according to investment banking firm Merriman, Curhan, Ford, and because Cree was then an attractive takeover candidate. It still is; however, since the stock has since risen something...

REDI-ing Your Portfolio for a Low-Carbon Economy

Tom Konrad, CFA Colorado's recently released Renewable Energy Development Infrastructure (REDI) report looks at what the resource-rich state needs to do to accomplish the state goal of reducing CO2 emissions 20% from 2005 levels by 2020.  Investors who expect the developed world to attempt similar cuts in emissions should take note of the report's conclusions, and invest accordingly. Since Colorado Governor Bill Ritter recruited my friend Morey Wolfson for the Colorado Governor's Energy Office (GEO) he's had a lot less time to socialize with the rest of us in the clean energy community, but we caught up over lunch...

EnerNOC Broadens Scope in Smart Grid Sector

Demand Responder Eyes New Growth Areas as Key Market Prices Dip  by Joyce Pellino CraneEnerNOC, Inc., announced its acquisition of Cogent Energy, Inc., on December 9, signaling a strategic move into the energy efficiency sector that is designed to help it capitalize on the Smart Grid’s growth potential.But the company was launched in 2004 as one solution to the country’s burgeoning demand for energy, and has grown into a leader among a handful of competitors in the demand response market.  Boston-based EnerNOC (Nasdaq: ENOC) helps businesses and grid operators reduce electricity consumption when demand is peaking and capacity strained. The...

Hidden Gems? Why Green Investors Should Look at Daewoo Shipbuilding and Ener1

Part 2 of 2 Bill Paul Neither Daewoo Shipbuilding & Marine Engineering Co. Ltd., which trades OTC under the symbol DWOTF, nor Ener1 Inc., which trades on NASDAQ under the symbol HEV, is an obvious candidate for having hidden potential. Heck, Daewoo isn’t even a green energy stock. Or is it? Lost in the hubbub of Copenhagen and Congress, there’s been important news about both these companies that strongly suggests – at least to me – that each has plenty of undiscovered potential that will really start paying off over the next 18 to 24...

Feel-Good Government Grants Leading Cleantech Astray

David Gold Grants for smart grid projects. Grants for battery manufacturing lines. Loan guarantees for renewable energy project development. Grants to private companies for energy efficiency projects. And with each it seems that the cleantech world cheers. Yet for all our desire to create sustainability in our consumption and use of energy, this model of getting us there is not only unsustainable but is of questionable value. I want to emphasize that I am speaking about government grants to the private sector where the government is not the end customer and...