Brookfield Renewable Energy Likely To Vote Against Western Wind Management in Proxy Battle

Tom Konrad CFA When it emerged that Brookfield Renewable Energy Partners (“Brookfield”, TSX:BRP.UN, OTC: BRPFF) had acquired approximately one sixth of Western Wind Energy’s (TSXV:WND, OTC:WNDEF) stock last Thursday from Western Wind’s largest institutional shareholder, Goodman & Company, investors cheered. The transaction was seen as a signal that Brookfield intends to bid at least C$2.25 for Western Wind in its upcoming sale, and so the company’s stock has been trading for slightly more than C$2.25 since the announcement. Despite this, the Brookfield/Goodman transaction may not prove to be a good deal for Western Wind’s other shareholders.  Goodman had not...

Power REIT: Light At The End Of The Tunnel?

Tom Konrad CFA It Could Have Been The First Yieldco Light at the End of the Tunnel photo via BigStock I first became interested in Power REIT (NYSE MKT:PW) in 2012 because of the company's plans to become what would have been the first US-listed "yieldco," i.e. a clean energy power producer paying a high level of reliable dividends to investors.  The company was an infrastructure Real Estate Investment Trust (REIT) with a single asset: its subsidiary, Pittsburgh & West Virginia Railway (P&WV) which owned 122 miles of track leased to Norfolk Southern Corp. (NYSE:NSC), which had in turn subleased the track...

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...

Mockumentary: This is Western Wind

Tom Konrad CFA The Windstar Wind Farm. Photo credit: Western Wind Energy If the sale of Western Wind Energy Corp (TSXV:WND, OTC:WNDEF) were a movie it would be a satire like This Is Spinal Tap, the 1984 Rob Reiner classic Mockumentary profiling a “Heavy Metal band on the verge of spontaneous combustion.” I doubt any wind turbines are about to spontaneously burst into flame, but the news keeps getting weirder. First, there was the hedge fund (Savitr) which began pressuring management to put the company up for sale after...

Capstone Infrastructure: Green Income At A Cardinal Discount

Tom Konrad CFA Capstone Infrastructure Corp.'s Gas Cogeneration facility in Cardinal, Ontario. Capstone Infrastructure Corporation (TSX:CSE, OTC:MCQPF. Disclosure: I own this stock) is an international operator and developer of green infrastructure assets and utilities which is currently selling at a significant discount to most comparable firms.  I recently ran a comparison of six similar Canada-listed firms, and Capstone seemed much cheaper on several measures. The Discount The following chart compares five renewable energy and green infrastructure firms with most of their operations in Canada: Capstone, Algonquin Power and Utilities (TSX:AQN, OTC:AQUNF), Brookfield Renewable Energy Partners (NYSE:BEP),...

The Ontario Green Energy Act: What Can Alt Energy Legislations Do For Investors

Dedicated legislations have been at the core of some of the most impressive regional growth stories in alternative energy, most notably in Germany with the Renewable Energy Sources Act or in California with the various legislative solar initiatives. On Monday, the Canadian province of Ontario became the latest jurisdiction to join the fray as lawmakers introduced the Green Energy and Green Economy Act. Why should investors care? Because such legislations have been at the core of some of the most impressive regional growth stories in alternative energy.  As a bit of a backgrounder on Ontario, there...

Dividends and Value Among Renewable Energy Power Producers

Tom Konrad CFA Almost every stock market sector fell significantly in late July and August this year, and such market declines send me searching for value stocks paying good dividends which I can hold for the long term.  In mid-July, I found some decent values by sifting through the trash, but I was less enthused by the value proposition of conglomerates involved in the clean energy space.  Today I'll take a look at a group of...

The Muscle Car Of Energy Efficiency

Tom Konrad CFA Disclosure: I am long TSX:PRI / PENGF. The poster child of energy efficiency has long been changing a light bulb.  First, it was swapping out an incandescent for a compact fluorescent, now the swap is to an LED.  Changing a light bulb is a small step that anyone can take, and it’s so cost effective that it can pay for itself in months if the bulb is used frequently. This is a good example of household energy efficiency measures: a small action requiring a limited investment that anyone can take that pays back quickly....

Calpine to sell about a fifth of power plants

Calpine Corp. (CPNLQ.PK) said it plans to sell about one-fifth of its power plants in a bid to emerge as a leaner company focused on its profitable geothermal and gas-fired operations. The company also said it plans to close three offices and cut about 775 jobs. Without identifying the plants, Calpine said the sale of about 20 facilities would allow it to focus on core assets and key markets. The company's largest power markets are California and Texas. The plans drafted by CEO Robert May should allow the company to save over $150 million a year and...

Atlantic Power: Not So Clean

Atlantic Power (AT) presents itself as a "clean" electricity generator. People who don't consider natural gas "clean" will disagree.

Power Plant Costs & The Case For Energy Efficiency

A few weeks ago, I stumbled upon a presentation that was given by FERC officials on the phenomenon of rapidly rising costs in US power generation (presentation link at the end of this post). The FERC, or Federal Energy Regulatory Commission, is America's energy watchdog. The presentation begins by noting that across America's major electricity hubs, power prices are up significantly on last year (between 62% in the Midwest and 123% in NYC) and that, unfortunately, this probably isn't an anomaly. In fact, the presentation argues, there may be something secular at play. Two main trends are noted....

Sol-Wind: A Unique Yieldco

By Jeff Siegel  President Obama gave renewable energy investors a very nice gift this week... As a part of his new budget proposal, the president is seeking a 7.2% increase in funding for “clean energy.” As well, he is asking for a permanent extension for the solar investment tax credit (ITC) and the wind energy production tax credit (PTC). The solar ITC is set to expire at the end of 2016, and the wind energy PTC has already expired. I can pretty much guarantee that a permanent extension of these tax credits is not going to happen....

Western Wind Expects Full Cash Grant for Windstar

Tom Konrad CFA The Windstar Wind Farm. Photo credit: Western Wind Energy On July 10, shares of Western Wind Energy (TSX:WND, OTC:WNDEF)plummeted because of a $12.2 million shortfall in the 1603 cash grant from the US Treasury for the company’s Windstar wind farm compared to the application.  In order to reassure skittish investors, the company held a conference call on Monday, July 16. On the tenth, I thought that investors should write off the 1603 cash grant shortfall, despite the fact that the company intended to send a delegation...

Where’s Western Wind Energy’s Tax Grant?

Tom Konrad CFA  On March 22, Western Wind Energy (TSX-V:WND, OTC:WNDEF) applied for a $90,556,707 tax-free 1603 grant from the US Treasury on behalf of the completed 120MW Windstar project.  The press release stated that the grant is subject to approval by the Treasury and payable within sixty days. The Windstar Wind Farm. Photo credit: Western Wind Energy It’s now more than three months later, and no tax grant.  The stock is down 24% since May 22, when the grant was expected, but management remains confident they will get...

My Yieldco Raised Its Dividend With This Weird Trick

Tom Konrad CFA Clean energy yieldcos buck the general trend by paying out a large proportion of cash flow to investors, and rapidly increasing their dividends at the same time.  The key to this trick has been their rapidly appreciating stock prices. High yield companies generally grow slowly, while high growth companies have low dividend yields. Normal companies grow by investing some profits in new business opportunities.  Early stage growth companies typically retain all their earnings to invest in new business.  More mature companies have fewer opportunities, and so share a larger proportion of...

Investors Expect Rapid Growth At Pattern Energy Group

Tom Konrad CFA Pattern Energy's Gulf Wind Farm in Armstrong, Texas Disclosure: Long BEP. Pattern Energy Group (NASD:PEGI, TSX:PEG) completed a very successful Initial Public Offering (IPO) on the Nasdaq and Toronto stock exchanges on September 27th.  Not only did the shares price at $22, near the top of the expected range, but the underwriters exercised their full over allotment option to purchase 2.4 million shares in addition to the initial 16 million offered.  Total proceeds from the offering were $404.8 million.  Most of the proceeds went to Pattern Energy Group, LP (PEGLP) in consideration for a...
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