Power Production

Tom Konrad, CFA Boralex Inc. made an offer to buy out the Boralex Power Income Fund on May 19.  The price is reasonable.  Boralex (BLX.TO, BRLXF.PK) announced on May 2 that it would offer C$5 per share in convertible bonds for all outstanding shares of the Boralex Power Income Fund (BPT-UN.TO, BLXJF.PK) that it did not already own in an acquisition approved by both boards.  As usual with mergers, the Boralex Power Income Fund's ("the Fund's") unit price jumped from C$4.61 to C$4.90 the next day, but then if started to fall back as people had...

by Shawn Kravetz In ten years of solar investing, we have never encountered an opportunity as obscure and potentially lucrative as Renewable Energy Trade Board Corporation (OTCPK:EBODF).  Disclosure: I am long EBODF. Before walking through the long thesis, we must caution potential investors that EBODF "went dark" with the SEC in March 2013. However, we have conducted rigorous due diligence on the ground in Asia and through the Hong Kong Stock Exchange filings of Goldpoly New Energy Holdings (0686.HK) - EBODF's sister company sharing the same parent/leading shareholder - China Merchants New Energy Group (part of massive Chinese...

Two weeks ago, I wrote about the emerging wood pellets industry and how this form of biomass was experiencing rapid growth as a coal substitute in power generation, mostly in Europe as a result of renewable energy and climate regulations. In the time since I wrote that article, I have been looking for ways to invest in the global wood pellets sector. Unfortunately, my search came up mostly empty (except for 1 stock discussed below). In response to my previous post, a reader pointed me to an article Joe Romm at Climate Progress had recently written...

The Pendulum Swings to Cash Over the long term, market cycles are characterized by swings of sentiment, and changes in investor preferences.  The recent cycle was characterized by an emphasis on growth and capital gains.  In the current financial crisis, investors are again learning the value of cash, and companies which produce steady cash flow and dividends.  Since the market tends to overshoot, I expect there will be a time a few years hence when, once again, the first question any investor asks about a stock is "What's the yield?" If I'm right, companies with strong cash flows that...

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...

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...

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

Charles Morand On Monday morning, I received an e-copy of a new research note by BofA Merrill Lynch arguing that disclosure by publicly-listed companies on the issue of climate change was becoming increasingly "important". The note claimed: "e believe smart investors and companies will recognize the edge they can gain by understanding low carbon trends." I couldn't agree more with that statement. It was no coincidence that on that same day the Carbon Disclosure Project (CDP), a non-profit UK-based organization that surveys public companies each year on the state of their climate change awareness, was...

Tom Konrad CFA The Windstar Wind Farm. Photo credit: Western Wind Energy Yesterday, I wrote about Western Wind Energy’s (TSXV:WND, OTC:WNDEF) plans to increase the 1603 cash grant for their Windstar wind farm.  But that was not the only thing discussed in Monday’s conference call. Investor Frustration During the Q&A, many investors were concerned about Western Wind’s recent deal to acquire a 4 GW wind development pipeline from Champlin/GEI Wind Holdings.   The concern was that the company would be issuing 8 million shares for the assets, but the company...

by Debra Fiakas CFA Renewable energy producer Juhl Wind filed to terminate registration of its common stock and cease filing financial reports with the Securities and Exchange Commission in September 2015, but the company was not withdrawing from the wind energy industry.  Instead Juhl expanded.  Now called Juhl Energy (JUHL:  OTC/PNK), the company’s corporate website boasts of its corporate headquarters in Minnesota powered exclusively by wind and solar energy.  The company also claims the successful development of over 350 megawatts of wind power generation capacity at 25 different wind projects.  Additionally, the company has dipped its corporate toe...

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...

Tom Konrad CFA Location of the Miekle wind energy project. Photo source: Finavera On June 21st, Finavera Wind Energy (TSXV:FVR, OTC:FNVRF) announced the ratification of the sale of its Tumbler Ridge and Meikle wind energy projects to Pattern Energy with 99.63% of votes cast in favor (a 2/3 majority was needed). The result should have surprised no one, given that the sale was essential to Finavera’s liquidity and ability to fund its operations.  After shareholder, stock exchange, and regulatory approval, Pattern will forgive C$9.3 million of Finavera’s...

by Tom Konrad, Ph.D., CFA It's been a busy several days in the YieldCo space. On February 5, 8point3 Energy Partners (NASD:CAFD) announced an agreement to be acquired by an infrastructure investment fund managed by Capital Dynamics. While I was still writing an article on why the sale price was at a virtually unheard of discount relative to the stock market price, two more YieldCo deals were announced: NRG Energy (NYSE:NRG) agreed to sell its sponsorship stake in NRG Yield (NYSE:NYLD and NYSE:NYLD/A) to Global Infrastructure Partners, and YieldCo TerraForm Power (NASD:TERP) made an offer to buy out Spanish YieldCo Saeta Yield (Madrid:SAY) at a 20 percent...

Jim Lane In New York, NASDAQ shares in Abengoa SA (ABGB) plunged 49% in Wednesday trading after the embattled renewable energy developer said it would seek bankruptcy protection as it seeks to reorganize nearly $9.4 billion in debt. The protective filing was announced after an expected infusion of nearly $300 million from Spanish steelmaker Gonvarri did not materialize. The company’s debt had been previously downgraded to a B3 rating by Moody’s, six rungs on the ladder beneath investment grade. Last week, Moody’s described the company’s cash reserves as “insufficient” and expressed that asset sales and a round of...

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....

by Debra Fiakas CFA Two weeks ago TerraForm Global, Inc. filed yet another amendment to its S-1 registration statement as the SunEdison, Inc. (SUNE:  NYSE) spinout grinds forward with its initial public offering.  TerraForm is a collection of SunEdison’s renewable energy properties, primarily its solar, wind and hydro-electric power generation facilities around the world.  The current portfolio sums up to over 1,400 megawatts in total generating capacity, of which over 900 are spoken for through power purchase commitments that cover the next 19 years.    On a pro forma basis, the assets produced $298.9 million in total revenue, providing...