JA Solar, has just issued a very bullish forecast for 2007 - a tripling of revenue and an increase in output to 100 megawatts from 75 in 2006. As I posted about the company last week, JA Solar has some great vertical integration going for it. And unlike some Chinese companies, this one has made some real effort to put together a website with clean lines and good english. Although I was a bit taken aback to read that they plan to have a production output of 175 MW by the 3rd quarter of 2007, when as per the report above the target was 100 Megawatts by end 2007. Scaling up solar power production is not easy - but to have one report in the press and another on your website cannot be correct.

I believe Forbes has got it wrong - but have emailed JA Solar to check as Reuters is reporting 175 MW like the company.

Around the world, utilities and government regulators are watching very closely the first mass energy storage device to be tied to a windfarm - VRB Power Systems flow batteries and Sorne Hill in the Republic of Ireland.

If you want to know why Ireland is the first country in the world to pioneer energy storage by wind farms this seriously, I reckon there are three reasons;

i) They have pretty much (except possibly New Zealand) the best sites in the world for windfarms - where windspeeds are so high, load factors of 35% are commonplace. So wind is cheaper in Ireland than almost anywhere else, incentivising developers to build more of it.

ii) A few years ago, TSO, who were in charge of Ireland's national grid (they are now called Eirgrid Plc), demanded a moratorium on new grid connections to wind farms at 775 MW to overcome the technical challenges of integrating large amounts of unpredictable power. So in order to progress, energy storage started to loom far larger in the minds of irish developers than in other nations, where it has clearly not actually happened at all.

iii) Ireland has grown by on average 7.5% per annum for each of the last 10 years and they need lots more power, which as island they can't easily import from abroad. Dell's Computers European headquarters are run out of Ireland and the country has been a magnet for foreign investment, requiring even more power.

So there you have it - if Sorne Hill's energy storage is seen to work, I can well imagine regulators around the world will be tempted to start mandating some degree of energy storage for future wind farms.

And it's hard not to see VRB Power Systems doing well out of that.

Iberdrola, which as I wrote in this feature on the world's biggest alternative energy companies here in January 2007, is the largest cap utility with the greatest alternative energy exposure, just might be eyeing up Rokas, as a potential acquisition target.

In Forbes magazine today, Iberdrola's Chairman called them "serious partners" while strategy director, Jose Luis del Valle said in response to a question on whether Iberdrola plans to buy out Rokas' minorities;

"We are not planning to buy any additional shares' at present . . . any such move is dependent on anti-trust approval."

Clean Energy Brazil plc, the newly-listed investment vehicle for Brazilian biofuels has just acquired an indirect minority stake of 49% in Usaciga Acucar Alcool e Energia Electrica SA for a consideration of BRL267.86 million (US$130 million).

Clean Energy Brazil's philosphy is to invest in integrated sugar and bioethanol production units in Brazil thereby creating exposure to Brazil’s domestic bioethanol market, the global sugar market and future growth in global bioethanol demand.

My view is that in principle, it's a great idea to set up a fund that goes into Brazil to buy up ethanol production for exposure to its investors back home. It's just that looked at in a distanced and sceptical way, could one be entirely convinced that they are going to;

a) do a better job than the Brazilians at their own industry ?
b) not pay over the odds for acquiring their ethanol assets when the oil price is high ?

Of the 6 strong CEB team only two appear to be Brazilian - so some awkward analysts might wonder if any of the other 4 speak any Portuguese?

I don't doubt that ethanol seems set to boom for at least the next 10 years in Brazil. The real test for biofuel producers may only come when the price of oil comes down - not a complete impossibility if the Middle East stabilizes and alternative energy technologies mature to mass market. And don't think it won't happen fast, especially if the price is right. Compared to two years ago, the Toyota Prius is already looking old-fashioned to what's coming through now. Just look at this crazy vehicle here - the Minicat which runs on compressed air. With 3 times the range of electric lithium ion battery vehicles and rechargeable in a mere 3 minutes, this is a very, very radical departure - if it takes off. Admittedly, most Americans wouldn't be seen dead in a dinky looking vehicle but many Europeans and Asians view these looks as a plus.

Biopetrol Industries AG - surely not the best choice of name for a biodiesel company - has just tripled fourth-quarter profit to more than 3 million euros as it finished building a new plant in Rostock, Germany.

The company now has a capacity of 350,000 tonnes of biodiesel production a year. Said Biopetrol Industries' Supervisory Board Chairman, Werner Klink;

"Biodiesel is now the leading sustainable alternative fuel. As long as the sun goes on shining, there will be plants. Biodiesel made from vegetable oil helps to protect the environment, safeguards jobs and opens up attractive long-term investment options."

And according to this great wiki, biodiesel can also point to a higher energy density of 42.2 MJ per kg compared to just 30 for ethanol. That means that for the same weight of fuel, biodiesel can take you much further.

Novera Energy, a company engaged in waste gas and wind power has just chosen to change domicile from Australia to the UK. This is pretty much the final stage in it's anglo-isation, if you'll forgive the phrase. Since listing on AIM in 2005, the company's focus has become more and more UKcentric.

Four-fifths of sales still come from landfill operations and according to this detailed article, profits are still 2 years away.

What is also potentially troublesome is that the author of the article believes the stock price of Novera is driven by the hopes of more UK windfarms coming onstream. You have to wonder if that is not too optimistic. No UK government has ever supported windpower so much as the current one under Tony Blair. And yet they were unable to force through windfarm developments through the planning system at anything like the rate they anticipated. A new government in the next few years will not be as favourable. And it seems at least possible that the likes of Novera - a minnow - will always be outbid on rights to a potential windfarm site by a bigger player.

Meanwhile, the future of building profitable onshore wind farms should really be in Central and Eastern Europe, rather than Western Europe. That was so yesterday's investment story. In Germany today, most of the good wind sites are now taken and the UK - more for planning reasons - is not a great future market either.

The blogosphere is very alive with discussion about hydrogen cars. It follows a National Hydrogen Association Convention meeting where a BMW representative said hydrogen-fuelled cars would not be commonplace until 2025.

I would argue that this is far, far too optimistic. Since writing The Hydrogen Economy - what price and when? a couple of years ago, I've changed my mind very little. Back then I believed that 2040 would be a more likely date for fuel cell vehicles. Although, making any prediction beyond 10 years is very hard to get right. 2 years ago for example, very few people had heard of plug-in hybrids. Now this is almost off-the shelf technology and I would venture it is going to succeed. This study shows that there is more than enough overnight spare electricity capacity to power 168 million plug-in hybrids in America. So why would you bother with hydrogen fuel cells ?

2 years ago, I did anticipate in the article that mass production of portable fuel cells for electronic devices would have started by now and we would be able to buy them - well it hasn't and I'm not sure if it ever will. But CHP fuel cells produced by the likes of Ceres Power and Ceramic Fuel Cells look very close to commercialisation and possible success.

Hoku Scientific, the Hawaiian fuel cell membrane developer which unusually decided to morph into a solar company, has just signed a 99 year contract on 67 acres of land to build their silicon wafer fab. Given that US property prices are down about 10% of their peak, the company did well to wait until now.

Or maybe not !

Hoku Scientific is only going to an annual rent of $1 per year, for the next 99 years and they may even get another 450 acres.

When complete, the plant will produce 2000 metric tons of polysilicon per year. That the land is effectively being given to them will help a lot to offset what should be a headache for any energy intensive fab - Hawaii's staggeringly high electricity prices.

One of Hoku's clients for all this polysilicon will be Germany's Solar Fabrik, who like most solar module manufacturers, just can't get enough of the stuff.

Since my last post on Ballard Power Systems, the stock has dropped even further, closing yesterday at 5.77. Yet last month's 2006 results show that revenues are still rising - up from $42.2 m in 2005 to $49.8m in 2006. The annual loss was much bigger at $128m, but a good 90% of that was due to a discontinuation of their electric drive business and its sale to Siemens on February 15th 2007 . As it was loss-making, capital intensive and not part of their core business, this has to be a good move.

I know I've been down on fuel cells and particularly fuel cells for transport for some time, but I do wonder if there is now room for a small recovery for Ballard and the transport fuel cell sector in general?

Ballard's latest deal with the US Department of Defence for forklift trucks research and development has to be a step in the right direction. Some people think that fuel cells for transport may only make it in transport niches - and Toyota would agree that forklift trucks are one of them.

Arguably, Ballard's early error in the 1990s was to overstate the case and the learning curves for their technology. It was always around the corner and we would soon all be driving fuel cell cars fuelled by hydrogen.

Yet the corners came and the fuel cells didn't.

This state of delusional optimism was embodied by the now ludicrous sounding book "Powering the future - the ballard fuel cell and the race to change the world", published in late 1999.

To be fair though, Ballard weren't the only ones to come out of that period not smelling of roses. The dot com boom went bust and then there were of course more than a few corporate scandals.

All in all, what I'm saying is that by Ballard standards, 2007 has the potential to be quite a good year. So let's see what happens - and I shall be very interested to see their Q1 2007 results.

A great piece here in Forbes magazine which sizes up the state of the biofuels industry over the last couple of years.

I was particularly interested to learn that 50% of this year's US corn crop will go to making ethanol. Government mandated targets for the rising participation of ethanol and biodiesel is clearly driving a demand for biofuel feedstocks not seen before. And this article says one way to play that demand is to buy into a fertilizer company called Mosaic and SunOpta, who hopes to be a player in the emerging cellulosic biofuel industry.

The first idea is definitely original - a bit like selling shovels to gold prospecters in 19th Century America. But I'm not aware - other than in Brazil - of how much virgin land is being used for biofuel crops or whether it is merely replacing existing food crops. So I wonder how much more fertilizer really will be used?

Meanwhile if SunOpta really does produce cellulosic biofuel in scale, then this will presumably reduce demand for fertilizer. So in a sense, these two stocks could hedge each other. Mosaic for the short-term and SunOpta for the long-term?

JA Solar, has just been rated with an outperform by Stuart Bush of RBC Capital Markets.

A lot of solar companies suffer from a lack of vertical intergration with their silicon suppliers - but this cannot be said about JA Solar Holdings. Their mother company is Jing Long Group - the world's largest silicon wafer manufacturer - who supply JA with silicon wafers. Many people think that if anyone can make solar power cheap, it will be the Chinese manufacturers. And apparently, according to the same analyst, the manufacturing costs of JA Solar are half that of their European rivals - post raw material costs like silicon.

Since going public on February 9th earlier this year, JA Solar has spiked up a couple of times, just above and just below 20.

My general view is that there's a lot of pent-up interest in Chinese companies that stock exchanges have been slow to pick up on. So news that the Nasdaq Stock Market has appointed new management in Asia, seeking to boost listings by companies in China and elsewhere in the region has to be a step in the right direction.

Not least because I was surprised to learn the other day that it is not yet a legal requirement for a company listing on AIM to have a website. It would seem to me that to have a website is the bare minimum of information a company should provide to any potential investor, but apparently not.

This will however change as of 1st July.

For some I've been considering a new sector for AEI - commodities. So this story in Business Week was a promising idea - looking at the companies that supply the infrastructure for alternative energy, whilst being decidedly light onw what those companies might be.

I think the anwer has to be the underlying commodities - this is the supply side story.

Some of them already have sophisticated markets - like ethanol, corn, soya - which are the feedstocks for biofuels and are traded on the Chicago Board of Trade futures markets. Other feedstocks like silicon for solar and lithium (as lithium ion) for energy storage are much less transparent in price. Meanwhile, the spiralling price of platinum for fuel cell catalysts has been a significant constraint on fuel cell production. Rising steel prices too have raised the costs of wind turbines, because steel is used in the towers to hold the turbines aloft.

Ceramic Fuel Cells - has just signed deals to develop its fuel cells with two German companies -- energy supplier EWE and boiler manufacturer Bruns Heiztechnik GmbH.

An Australian company, it has a dual listing on London's AIM as well as the ASX. Yet the focus of their expansion is principally Europe. As their recent annual report mentioned, a site has been found in Germany for volume manufacturing at the Nuon Industrial Park, North Rhine Westphalia. And more encouragingly, unlike some fuel cell companies, the end of development and the start of mass manufacturing is within sight - about 2009, according to this roadshow powerpoint on page 10.

Back in August 2005, I said about CFC,

"It used to be thought that it was more a question of if fuel cells would ever come into the home. Now it's looking more like when. There are though two questions that need to be answered;

My guess is that over the next 2 to 3 years we will find out the answers. And Ceres Power and CFC will either be on the road to greatness or the dirt track to nowhere. "

The answer to the last question is for CFC now clear - as received EUR 3.2m in funding from the North Rhine Westphalia regional government. From 2009 we will find out if the home fuel cell market comes of age and consumers actually buy them.

There was just one major story yesterday in the alternative energy stock world - Biofuels Corporation announcing that the year's results were going to be worse than the market expected and that they would need up to £25 million in investment to keep going.

Biofuels Corp has been in and out of trouble for some time - as I blogged about here back in 2005. Volatility appears to be a hallmark of this stock - right now (11.20 am London time) it is up 18%, having almost halved in value yesterday.

You'd be forgiven for thinking that biofuels were a straightforward good bet with governments around the world pledging to increase their mandated share of transport fuel in the years to come. And yet, the unforseen consequence of this action was to unleash higher raw material costs in the scramble for the limited supply of feedstock crops - this has clearly hurt Biofuels Corp. Something similar happened with solar power and silicon prices. And with windpower, that industry has run up against a world shortage of steel.

My prejudice is that alternative energy vehicles that run on hybrid electric technology have much more potential than biofuels. Although, we may see a new run-up in the price of lithium (for the batteries) to meet demand.

Suzlon Energy, is planning to diversify out of wind into biodiesel and solar.

Measured by its margins - 38% gross and 22% operating, Suzlon is the most profitable wind company in the world. So why dilute that?

That is what seems to be happening. Does Suzlon really need to take over Repower Systems AG, who last year had a low single digit gross margin and a negative operating margin?

And now, they are going to diversify into biodiesel and solar. I'm all for diversification, but only if it is into higher margin activity. I doubt very much that they can repeat their results in two very different industries. Suzlon just might be falling into the classic trap of diversifying out of their own success.

For now, Suzlon might be best advised to stick to the wind.

Repower AG, the focus of a takeover struggle between Suzlon Energy and Areva has just reached a crucial point. According to the French Finance Minister, Thierry Breton, Areva should reconsider its plans to take over German wind turbine maker Repower Systems AG, as the price is being driven too high.

Some of us might think, "What's a commercial decision like that got to do with him and what does he know about company valuation better than the management of Areva?"

But that's not how French capitalism works, which has a marked preference for the Big Man. Areva, after all is owned by the French state so the politicians get to call the shots, however unenlightened they might be.

Active Power, a maker of flywheels, has just opened a Tokyo office in order to serve the burgeoning Asia-Pacific markets.

I'm sure there are good reasons for being in Tokyo, but by far and away the greatest growth in electricity consumption is going to be in China, which plans a 6 fold increase in electrification by 2020. Still, many high-tech firms - including I would guess, Active Power - remain nervous of locating in China. They worry that their intellectual property will not be protected, either by the business culture and especially by the courts. A quick glance at the internet suggests there are more than a few companies in China that are engaged with flywheel technology who wouldn't mind getting together with AP or for that matter Beacon Power.

As I wrote recently here in Power Engineer Magazine . . .

"A breakthrough in multi-megawatt class energy storage is at least a possibility in the next 10 years. At the moment, only a few megawatts can be stored using various energy storage technologies, and at great cost. Wind power would make a huge contribution if perhaps 1000MW could be stored overnight (when it is almost worthless) and sold back into the spot market during the day – when prices are at their highest."

So I was very taken to learn of Sorne Hill windfarm in Ireland, which will shortly have 12 megawatt hours of vanadium flow battery storage, courtesy of VRB Power Systems. Just view all the technical detail here in this January07 piece in New Scientist.

If I've got my doubts still though, there is as yet absolutely no mention of cost for this technology - hard figures like cost per installed watt. The plan for this windfarm seems to be to sell back into the spot market, which would make sense if the technology was expensive and the spot prices were high. And I'm just trying to imagine how big these vanadium flow batteries are. If - as per the article - 70,000 litres of vanadium sulphate solution delivers 800 kilowatt hours, that means 87,500 litres gives you 1 megawatt hour. 12 megawatt hours then requires 1,050,000 litres - or (assuming a similar volumetric density to water) 1,050 cubic metres of space or 37,500 cubic feet of space needed to hold the batteries. That seems like a lot of space, but it is certainly much less than the total surface area required for a 12 megawatt windfarm.

If all goes well at Sorne Hill windfarm, I think we'll see a vast increase in this kind of energy storage. Selling into a spot market with supply shortfalls has to be the most cost-effective way to make this technology pay. So I'm wondering when this will take off in California . . . if it had been around in 2001 in scale, I'm sure that enron traders could not have made anything like the profits they did.

VRB is definitely a company to watch - it has an energy technology that can actually bring prices down.

As someone who is ever so slightly nerdy, I like my information to arrive thick and fast.

So hats off to Brian D. Fairbank, President and CEO of Nevada Geothermal Power who packed in an amazing amount of useful information into a a few short minutes on http://www.robtv.com/ - click on play under 8.50 a.m. ET.

The informational soundbite highlights were;

"You could look at (Geothermal) like a superheated lake of underground water"

"Nevada is ideal geology for this sort of stuff"

"Costs are all in 4 cents a kilowatt hour and you can sell it for 5 or 6"

Today was also the day that Nevada Geothermal announced the grant of 3,822,000 incentive stock options to certain directors, officers, employees and consultants. The options will be exercisable at a price of $0.65 per share for five years and the common shares are subject to a four month hold period from the date of this grant - 2nd March 2007.

For the time being, Nevada Geothermal is still a development company - the first of four plants, "Blue Mountain", will not come on stream until 2009.

This is certainly a company and an industry to keep an eye on. Although over what time period and with what load factor the figure of 4 cents a kilowatt hour is reached - obviously beyond the scope of this 6 minute podcast - would be very interesting to know.

Solarworld has on the face of it, just made a very innovative, shrewd move.

They have bought up a failing japanese silicon chip factory in Oregon, USA, for $40 million. The factory - or should we say Fab - had already had investment dollars haemorraged into it by Japan's Komatsu-Group; $794 million until the crash in chip prices made it financially unviable.

The deflation though in semiconductor prices has not been reflected in the solar pv market, where supply clearly cannot match demand. So Solarworld are going to convert the factory to a silicon wafer and cell production unit at a cost of $397 million. The future output of this converted solar plant has been put at 500 megawatts per year.

This reminds me of a conversation I had many years ago with a very successful entrepreneur - of all things in high-end bespoke wooden furniture - who shared with me his plans to buy a restaurant to entertain his clients and friends in. The key to owning a successful restaurant he said, was not to set it up yourself. Ideally, you buy a 2 year old restaurant that had just about failed. That way, someone else had haemorraged all the investment money on location, fittings, marketing, staff etc.

Just when they are at the point of collapse - because restaurants have such a high failure rate - this was the time to move in, buy it up for a song and get into the business. Apparently, all you really needed to then do was to invest in a good chef !

So there you go - like restaurants, semiconductor fabs are very, very expensive to build and the world is awash with them. Buying one off the shelf and converting it for your own purposes is potentially extremely clever. I suspect the rest of the solar world will be watching this experiment very closely and may already have started scouring redundant semiconductor fabs in Europe, Asia and the USA.