Energy Investing: What To Expect In 2015

By Jeff Siegel Tonight, I will welcome in the New Year with family. We'll feast on cured meats, pickled vegetables, and lamb neck stew. We'll sip an old fashioned or two with apple and sage, share some laughs, and maybe even shed a few tears as we remember those we lost in 2014. When the ball drops, we'll hug, kiss, and cheer on all that waits to be discovered in 2015. There will be good and there will be bad, but I suppose it's the uncertainty of it all that makes life worth living. Don't Fear the Uncertain It...

Cheap Oil: Nemesis Or Sideshow?

by Garvin Jabusch Next economics posits that for the global economy and earth's tolerances/carrying capacities to run in a mutually tolerable equilibrium, we must continue to make rapid advances in economic efficiencies in all sectors. For 7.3 billion of us (and counting) to thrive on finite resources and avoid the worst effects of climate change, we have to drive more and more economic output from less and less input. Fortunately, energy is one of the areas where we can quickly make huge strides in this respect but not with fossil fuels in the mix. On the contrary,...

Big Money Looking For Green Investments

Sean Kidney Climate Finance session at UN Summit is electric.  Insurers go wild with promises; investors plead for green investments; Jim Kim almost breaks out in song about green bonds. It's the day after the UN Climate Summit party in New York. Yes I do feel as if I'm hungover; but it was a gas. If you're one of those who worry about the world, there is something magical in being inside the totemic General Assembly, with it's embodiment of one world idealism. Ban Ki Moon's audacious Summit convening (that's really the only power we allow...

Divesting: Last One Out Loses

Tom Konrad CFA Anew report written by Nathaniel Bullard at Bloomberg New Energy Finance highlights the difficulties large institutional investors would have divesting from fossil fuels. What it does not specifically discuss is that these difficulties could lead to large financial losses for investors who see the difficulty of divesting as a reason to delay. Just as we can't easily fill up our cars with solar power instead of gasoline, the report points out that there is no asset class that can directly substitute for oil and gas in large institutional portfolios. A person...

Capital Pacific Bank: Free Market Alternative with a Conscience

Not A Bankster By Jeff Siegel In the long, slow recovery from the 2008 financial collapse, the banking industry has increasingly been regarded as a buglight for the untrustworthy. The Libor (London Interbank Offered Rate) scandal brought banking corruption to the front of the news, and showed the world a huge ethical hole that had burned through the middle of major banks. In a 2012 essay entitled “Is Banking Unusually Corrupt, and If So, Why?” Financial analyst, Circuit Court judge and University of Chicago Law School Lecturer Richard A. Posner laid out the reasons why...

Renewable Energy Stocks By The kWh

Tom Konrad CFA Disclosure: Long BEP.  Short PEGI $20 and $25 puts, short PEGI $30 and $35 calls, short NYLD $40 and $45 calls. I recently sized up five renewable energy power producers using the metric that’s most often used for solar panels: Dollars per Watt ($/W).  It’s an intuitive metric, but has serious flaws both for evaluating solar installations and stocks.  Slightly better is Watts per Dollar (or W/$100 to make the numbers look nice) as shown in the chart from that article below. The main advantage of W/$100 over $/W is that it’s additive: I can meaningfully...

Renewable Energy Stocks By Dollars Per Watt

Tom Konrad CFA Disclosure: I and my clients own HASI and BEP. I have short call positions in NYLD and PEGI, and short put positions in PEGI. Dollars per watt ($/W) is a lousy measure of the economics of solar, but it persists. Most likely, it persists because it seems familiar.  We can pay $4 for a watt of solar, or $4 for a Iced Hazelnut Macchiato at Starbucks.  Unfortunately, while the analogy may seem apt, this is a lot like knowing you’re getting a Macchiato without knowing if it’s a Tall, Grande, or Venti.  The actual energy production from a...

Our Investments Matter

The stocks and mutual funds we own have a real effect on the behavior of the companies we choose (not) to invest in.

A Dangerous Game Of Us vs. Us Played With Our Life Savings

Tom Konrad CFA US law requires that money managers put their clients’ interests first. Investment advisers and money managers almost universally assume this means that they must try to make as much money for clients as possible. If your job is all about money, this can seem like a natural interpretation. More money is better, right? For others, equating making money to serving clients’ interests seems like a very narrow view of the world. If Tracy is saving for retirement, she obviously wants to have enough money to pay for it. She also wants to be healthy enough...

Watt’s Watt?

Watts are standard, but the way we talk and write about them is not.

Renewable Energy Finance Outlook for 2014: Where Will the Cash Flow?

By all accounts, more money will be invested into renewables in 2014 than was invested in 2013. Our experts lay out where, why, when and how. Jennifer Runyon The world of renewable energy finance is vast: encompassing everything from venture capital funding for innovative start-ups, to research and development (R&D) and manufacturing expansion spending, to project finance and all the way through to investing in clean energy companies on the stock market. Because of that, for the general public, predicting where money will flow over the course of the next year is a shot in the...

Google’s Renewed Cleantech Investment Binge

James Montgomery Google Doodle for Earth Day 2006 This week the Internet giant Google revealed that in December it invested $75 million in Pattern Energy's (NASD:PEGI) 182-MW Panhandle 2 wind farm in Carson County, Texas, northeast of Amarillo, expected to be operational by the end of this year. Pattern will hold an 80 percent stake in the project, whose owners also include Google and two institutional tax equity investors, with Morgan Stanley providing construction and equity bridge loans and a letter of credit. Google certainly has displayed a healthy...

Alternative Energy Stocks In 2013: Winners And Losers

By Harris Roen Alternative energy stocks had an epic year in 2013. The widely watched Ardour Global Alternative Energy Index Composite (AGIGL) was up 53% in 2013. That’s double the 26% return for the S&P 500. In fact, 2013 marked the largest annual return for the AGIGL since 2007. In January 2013, I predicted that “…low interest rates and plenty of corporate cash will be a strong driver of stocks in 2013, including the growth industries within alternative energy.” That forecast turned out to be true and then some. This report drills down...

60 Minutes Reply: Cleantech Rocks

On Sunday, January 5, 60 Minutes aired a piece on the cleantech space. In the days that followed, I have had interesting conversations with clients about what was broadcast to 7.4 million viewers. Those discussions reinforced my belief that 60 minutes missed the mark and inspired me to write this blog on why cleantech is essential, massive, vibrant, and desired. Cleantech is essential. We recently took fifteen clients to China on our annual tour, and the Beijing Air Quality index (AQI) of PM2.5 read above 200 on multiple days. The average AQI in Los Angeles, California, through 2009...

Graftech Manages the Heat of Competition

by Debra Fiakas CFA Products like Graftech's ultra-thin heat spreader help customers manage the heat. Investors think restructuring will help Graftech do the same. Feeling the heat of competition, graphite materials supplier Graftech International Ltd. (GTI:  Nasdaq) has initiated a restructuring of sorts.  The company’s two highest cost graphite electrode plants will be closed.  Those are located in Brazil and South Africa.  A machine shop in Russia will also be shuttered.  Locks will go on the doors in these locations by the end of...

What Do The New Crowdfunding Rules Mean For Renewables?

James Montgomery Crowdfunding illustration via Bigstock   The SEC has finally proposed its rules to allow crowd-funding under the Jumpstart Our Business Startups (JOBS) Act. What do they mean for small-scale investments in renewable energy companies and projects? Title III of the JOBS Act created an exemption under securities laws for crowdfunding, which set the table for its regulation by the SEC that was supposed to happen by the end of last year. Two weeks ago the SEC finally issued its proposed rules on crowdfunding (summary...